Sidbury Station CC&R's B6540-P2864Book 6540 Page 2864
BK: RB 6540 IIIIIIIII�IIIIIIIIIIIIIIIIII IIIIIIIIIIII
PG: 2864-2922
RECORDED: 2022006883 NC FEE $198.00
02-22-2022 NEW HANOVER COUNTY, NC
02:21:28 PM TAMMY THEUSCH PIVER
BY: STEPHANIE PEREZ REGISTER OF DEEDS
DEPUTY
DECLARATION
OF
COVENANTS, CONDITIONS,
RESTRICTIONS AND EASEMENTS
SIDBURY STATION
Prepared by and Return to:
Michael R. Ganley, Attorney
Bagwell Holt Smith P.A.
111 Cloister Court, Ste. 200
Chapel Hill, NC 27514
Book 6540 Page 2865
TABLE OF CONTENTS
1. Application of the North Carolina Planned Community Act ................................................ 6
2. Definitions...................................................................................................................................6
2.1. "Annexation Declaration"...............................................................................................................................7
2.2. "Architectural Guidelines".............................................................................................................................7
2.3. "Articles of Incorporation".............................................................................................................................7
2.4. "Association"...................................................................................................................................................7
2.5 "Base Assessment"..........................................................................................................................................7
2.6. "Board of Directors".......................................................................................................................................7
2.7. `Bylaws".........................................................................................................................................................7
2.8 "Common Areas".............................................................................................................................................7
2.9. "Common Expenses"......................................................................................................................................7
2.10. "Community -Wide Standard".......................................................................................................................7
2.11. "Declarant"...................................................................................................................................................7
2.12. "Declarant Control Period"..........................................................................................................................8
2.13. "Declaration"................................................................................................................................................8
2.14. "Governing Documents"...............................................................................................................................8
2.15. "Lot".............................................................................................................................................................8
2.16. "Limited Common Areas"............................................................................................................................8
2.17. "Master Plan"...............................................................................................................................................8
2.18. "Member"..................................................................................................................................................... 8
2.19. "Mortgage"...................................................................................................................................................8
2.20. "Neighborhood"...........................................................................................................................................8
2.21. "Neighborhood Assessments"......................................................................................................................8
2.22. "Neighborhood Expenses"............................................................................................................................8
2.23. "Occupant"....................................................................................................................................................8
2.24. "Owner"...................................................................................................................................I...................9
2.25. "Recorded Document"..................................................................................................................................9
2.26. "Rules & Regulations"..................................................................................................................................9
2.27. "Special Assessments"..................................................................................................................................9
2.28. "Specific Assessments"................................................................................................................................9
2.29. "Stormwater Control Facilities"...................................................................................................................9
2.30. "Supplemental Declaration".........................................................................................................................9
3. Sidbury Station Community Association, Inc.........................................................................9
3.1.
Purposes.....................................................................................................................................................10
3.2.
Powers and Responsibilities............................................................................................................10
3.3
Voting Rights and Meetings...........................................................................................................10
3.4
Bylaws.......................................................................................................................................................11
4. Use and Occupancy of Lots and Common Areas......................................................................11
4.1.
Fundamental Restriction on Use................................................................................................................11
4.2.
Fundamental Restriction on Occupancy.....................................................................................................11
4.3.
Additional Restrictions on Use and Occupancy of Lots.............................................................................11
4.3.1
Completion of Construction.......................................................................................................................11
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Book 6540 Page 2866
4.3.2 Subdivision of Lots....................................................................................................................................11
4.3.3 Subdivision of Common Area....................................................................................................................11
4.3.4 Signs........................................................................................................................................................12
4.3.5 Refuse Storage...........................................................................................................................................12
4.3.6 Storage of Building Materials....................................................................................................................12
4.3.7 Temporary Structures.................................................................................................................................12
4.3.8 Parking and Vehicle Storage......................................................................................................................12
4.3.9 Offensive Activities Prohibited..................................................................................................................12
4.3.10 Underground Utilities................................................................................................................................12
4.3.11 Mobile Homes and Manufactured Housing...............................................................................................13
4.3.12 Screening...................................................................................................................................................13
4.3.13 Swimming Pools........................................................................................ Error! Bookmark not defined.
4.4 Rules and Regulations................................................................................................................................13
4.4.1. Declarant's Authority.................................................................................................................................13
4.4.2. Board Authority.........................................................................................................................................13
4.4.3. Members' Authority ...................................................................................................................................13
4.4.4. Conflicts.....................................................................................................................................................13
4.5. Limitations.................................................................................................................................................13
4.5.1. Displays.....................................................................................................................................................14
4.5.2. Activities Within Dwellings...................................................................................................................
14
4.5.3. Alienation..................................................................................................................................................14
4.5.3 Abridging Existing Rights..........................................................................................................................14
4.6 Common Areas Administrative Rules........................................................................................................14
4.7 Notice to Purchasers and Mortgagees........................................................................................................14
5. Architecture and Landscaping................................................................................................15
5.1. General.......................................................................................................................................................15
5.2
Architectural Review.................................................................................................................................15
5.2.1.
By Declarant..............................................................................................................................................15
5.2.2.
Architectural Review Committee...............................................................................................................16
5.3
Reviewer.....................................................................................................................................................
16
5.4
Guidelines and Procedures.........................................................................................................................16
5.4.1
Architectural Guidelines............................................................................................................................16
5.4.2
Procedures.................................................................................................................................................17
5.5
No Waiver of Future Approvals.................................................................................................................18
5.6
Variances...................................................................................................................................................18
5.7
Limitation of Liability................................................................................................................................19
5.8
Certificate of Compliance..........................................................................................................................19
5.9
View Impairment.......................................................................................................................................19
6. Maintenance and Repair..........................................................................................................20
6.1 General.......................................................................................................................................................20
6.2 Association Responsibility .........................................................................................................................20
6.3 Owner's Responsibility..............................................................................................................................20
6.4 Association's Right to Perform Owner's Responsibility ............................................................................21
6.5 Cost of Maintenance..................................................................................................................................21
6.6 Conveyance of Common Areas to Association; No Implied Rights..........................................................21
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Book 6540 Page 2867
6.7 Liability ......................................................................................................................................................22
7. Insurance................................................................................................................................... 22
7.1 Association's Responsibility ......................................................................................................................22
7.2 Owner's Responsibility ..............................................................................................................................25
8. Repair and Reconstruction......................................................................................................26
9. Assessments and Association Finances...................................................................................26
9.1
Purpose of Assessments.............................................................................................................................26
9.2
Creation of the Lien and Personal Obligation for Assessments.................................................................27
9.3
Budgeting and Allocating Common Expenses...........................................................................................28
9.4
Special Assessments..................................................................................................................................29
9.5
Specific Assessments.................................................................................................................................29
9.6
Authority to Assess Owners; Time of Payment.........................................................................................30
9.7
Neighborhood Assessments.......................................................................................................................30
9.8
Subordination of Liens to Mortgages.........................................................................................................30
9.9
Remedies of the Association......................................................................................................................31
9.10
Budget Deficits During Declarant Control.................................................................................................32
9.11
Failure to Assess........................................................................................................................................33
9.12
Statement of Account.................................................................................................................................33
9.13
Exempt Property ........................................................................................................................................33
9.14
Capitalization of Association.....................................................................................................................34
10. Expansion of the Community..................................................................................................34
10.1. Expansion by Declarant............................................................................................................................. 34
10.2. Expansion by the Association....................................................................................................................34
10.3. Withdrawal of Property ..............................................................................................................................34
11. Declarant Rights.......................................................................................................................35
11.1.
Reasonable Rights To Develop..................................................................................................................35
11.2.
Marketing and Sales Activities..................................................................................................................36
11.3.
Construction of Improvements...................................................................................................................36
11.4.
Right to Approve Additional Covenants....................................................................................................36
11.5.
Right to Transfer or Assign Declarant Rights............................................................................................36
11.6.
Exclusive Rights to Use Name of Development........................................................................................37
11.7.
Right to Approve Changes in Community Standards.................................................................................37
11.8.
Easement to Inspect and Right to Correct..................................................................................................37
11.9
Neighborhoods...........................................................................................................................................37
11.10
Appointment or Removal of Members of the Board and officers..............................................................38
11.11
Amendment to Declaration........................................................................................................................
38
11.12
Review of Design and Construction...........................................................................................................38
12. Easements..................................................................................................................................38
12.1 Owners' Easements of Enjoyment..............................................................................................................38
12.2 Walks, Drives; Parking Areas, and Utilities...............................................................................................38
12.3 Encroachments and Declarant's Easement to Correct Drainage.................................................................39
12.4 Easement for Entry Features......................................................................................................................39
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Book 6540 Page 2868
12.5 Construction and Sale Period Easement....................................................................................................39,
12.6 Irrigation....................................................................................................................................................40
12.7 Fence Easement.........................................................................................................................................40
12.8 Easement to Government Entities..............................................................................................................40
12.9 Easement and Right of Entry for Repair, Maintenance and Reconstruction.............................................40
12.10 Pedestrian Easements.................................................................................................................................40
12.11 Right of the Association and Declarant to Enter Upon the Common Areas...............................................41
12.12 Right -of -Way Over Roadways...................................................................................................................41
12.13 Utility and Drainage Easements.................................................................................................................41
12.14 Declarant's Right to Assign Easements; Maintenance of Easement Areas ................................................41
12.15 Easement Reserved for the Association and Declarant..............................................................................42
12.16 Additional Easements................................................................................................................................42
13. Dispute Resolution and Limitation on Litigation..................................................................43
13.1.
Consensus for Association Litigation.........................................................................................................43
13.2
Alternative Method for Resolving Disputes...............................................................................................43
13.3.
Claims........................................................................................................................................................44
13.4.
Mandatory Procedures...............................................................................................................................44
13.5
Allocation of Costs of Resolving Claims...................................................................................................46
13.6
Enforcement of Resolution........................................................................................................................46
14.
Mortgagee Provisions...............................................................................................................46
14.1
Notices of Action.......................................................................................................................................47
14.2
No Priority.................................................................................................................................................47
14.3
Notice to Association.................................................................................................................................47
14.4
Failure of Mortgagee To Respond.............................................................................................................47
14.5
Construction of Article XIV......................................................................................................................48
15. Changes in Common Areas..................................................................................................... 48
15.1. Condemnation............................................................................................................................................48
15.2. Transfer, Partition, or Encumbrance of Common Areas............................................................................48
16. Fines and Suspension of Privileges or Services.....................................................................49
17. Miscellaneous.............................................................................................................................49
17.1 Parties Bound.............................................................................................................................................49
17.2 Duration.....................................................................................................................................................49
17.3 Amendment................................................................................................................................................49
17.4 Enforcement...............................................................................................................................................49
17.5 Failure to Enforce Not a Waiver................................................................................................................50
17.6 Assignment by Declarant...........................................................................................................................
50
17.7 Notice of Sale, Lease or Acquisition..........................................................................................................50
17.8 Variances...................................................................................................................................................50
17.9 Severability................................................................................................................................................50
17.10 Captions.....................................................................................................................................................50
17.11 Law Controlling.........................................................................................................................................50
17.12 References to Statutes................................................................................................................................50
17.13 Assessments for Public Improvements/Ad Valorum Taxes.......................................................................51
5
Book 6540 Page 2869
DECLARATION
OF
COVENANTS, CONDITIONS, RESTRICTIONS AND EASEMENTS
FOR
SIDBURY STATION
This Declaration is made as of the date executed below by D.R. Horton, Inc., a Delaware
corporation, 131 Racine Drive, Suite 201, Wilmington, NC 28403, hereinafter referred to as the
"Declarant." The Declarant states and declares as follows:
A. The Declarant is the owner of that tract of land located in New Hanover County,
North Carolina, and described in Exhibit A attached hereto and incorporated herein (the
"Property");
B. The. Declarant intends to subdivide the Property into residential lots, common
areas and public rights -of -way, and to create from the Property and such additional land as may
be subjected to this Declaration pursuant to Article X below a planned community to be known
as Sidbury Station (the "Community"); and
C. The Declarant desires to impose certain restrictive and protective covenants upon
the Property to provide voting rights for Members in the Association and assessment allocations
for Common Expenses to protect and to promote the beneficial ownership, use and enjoyment of
all residential lots located within the Community.
THEREFORE, pursuant to Chapter 47F of the North Carolina General Statutes (the
"Planned Community Act"), the Declarant hereby executes this Declaration to create Sidbury
Station, a North Carolina planned community, and declares that henceforth all portions of the
Property shall be held and owned subject to the following terms, provisions, covenants,
conditions and restrictions, which shall run with the Property and which shall be binding upon all
owners of any portion of the Property and their lessees, guests, mortgagees, heirs, executors,
administrators, successors and assigns.
Article I
Application of the North Carolina Planned Community Act
The terms and provisions of Chapter 47F of the North Carolina General Statutes, as the
same shall be amended from time to time, shall apply to the Community.
Article H
Definitions
The definitions set forth in N.C.G.S. § 47F-1-103 shall apply to this Declaration and are
incorporated herein, except that the terms listed below shall have the specific meanings stated:
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Book 6540 Page 2870
2.1. "Annexation Declaration" shall mean an instrument recorded at the New Hanover
County Registry that subjects additional land to this Declaration.
2.2. "Architectural Guidelines" shall mean the architectural, design and construction
guidelines and review procedures adopted pursuant to Article V below, as they may be amended.
2.3. "Articles of Incorporation" shall mean the Articles of Incorporations for Sidbury Station
Community Association, Inc., a North Carolina nonprofit corporation.
2.4. "Association" shall mean Sidbury Station Community Association, Inc., a North
Carolina non-profit corporation, its successors and assigns.
2.5 "Base Assessment" shall mean the assessment levied on all Lots subject to assessment
under Article IX below to fund Common Expenses, as determined in accordance with Article IX
below.
2.6. "Board of Directors" or "Board" shall mean the executive board of the Association, as
defined by the Planned Community Act and as created by the Bylaws.
2.7. "Bylaws" shall mean the bylaws of the Association as they now or hereafter exist and as
they may be amended from time to time.
2.8 "Common Areas" shall mean all property, and any improvements thereon, wherever
located, owned or leased by or dedicated to the Association or subjected to an easement or
license in favor of the Association for the common use and enjoyment of Members. Common
Areas shall include all water and sewer lines serving more than one Lot and located outside any
public rights -of -way or utility easements. Common Areas shall include any Stormwater Control
Facilities serving more than one Lot and not accepted by any governmental authority for
maintenance. Common Areas shall include any streets or road rights -of -way serving more than
one Lot and not accepted by any governmental authority for maintenance.
2.9. "Common Expenses" shall mean all costs of the Association in maintaining Common
Areas, and meeting its responsibilities pursuant to Articles VI, VII and IX of this Declaration.
2.10. "Community -Wide Standard" shall mean the standard of conduct, maintenance, or
other activity generally prevailing in New Hanover County, North Carolina, or the minimum
standards established pursuant to the Architectural Guidelines, Rule and Regulations, and Board
resolutions, whichever is the higher standard. Declarant shall initially establish such standard,
which may involve both objective and subjective elements. The Community -Wide Standard
shall evolve as the Community evolves.
2.11. "Declarant" shall mean D.R. Horton, Inc., a Delaware corporation, or any successor or
assign designated as Declarant in a Recorded Document executed by the immediately preceding
Declarant.
Book 6540 Page 2871
2.12. "Declarant Control Period" shall mean the period of time during which Declarant holds
a fee interest or contractual right in any portion, however small, of the land described in Exhibit
A and/or Exhibit B attached hereto and incorporated herein.
2.13. "Declaration" shall mean this Declaration of Covenants, Conditions, Restrictions and
Easements for Sidbury Station, and any amendments hereto or restatements hereof.
2.14. "Governing Documents" shall mean, collectively, this Declaration, any applicable
Supplemental Declaration, the Articles of Incorporation, the Bylaws, the Architectural
Guidelines and the Rules and Regulations, as the same may be amended from time to time.
2.15. "Lot" shall mean any separate parcel of land within the Community designated for
separate ownership or occupancy and residential use.
2.16. "Limited Common Areas" shall mean a portion of the Common Areas reserved for the
exclusive use of one or more, but less than all, of the Lots.
2.17. "Master Plan" shall mean the master land -use plan for the development of the
Community approved by New Hanover County, North Carolina.
2.18. "Member" shall mean and refer to every person or entity entitled to membership in the
Association as provided in Article III below.
2.19. "Mortgage" shall mean a deed of trust recorded at the New Hanover County Registry
that is a lien against any Lot. "Mortgagee" shall refer to a beneficiary or holder of a Mortgage.
A "First Mortgage" shall be a Mortgage having priority over all other Mortgages encumbering a
Lot. "First Mortgagee" shall refer to a beneficiary or holder of a First Mortgage.
2.20. "Neighborhood" shall mean any area or areas within the Community designated by a
Supplemental Declaration to be a distinct or separate residential area within the Community, the
residents of which will share or have in common expenses, interests, concerns, responsibilities,
needs or uses not shared by or common to all residents within the Community.
2.21. "Neighborhood Assessments" shall mean assessments levied in accordance with
Section 9.7 below.
2.22. "Neighborhood Expenses" shall mean the actual and estimated expenses which the
Association incurs or expects to incur for the benefit of Owners within a particular Neighborhood
or Neighborhoods, which may include reasonable reserves for capital repairs and replacements
and reasonable administrative charges, as may be authorized pursuant to this Declaration or in
the Supplementary Declaration(s) applicable to such Neighborhood(s).
2.23. "Occupant" means any person occupying all or any portion of a Lot or other property
located within the Community for any period of time, regardless of whether such person is a
tenant of the Owner of such property. "Occupants" shall refer to more than one Occupant.
Book 6540 Page 2872
2.24. "Owner" shall mean and refer to an owner of record of a fee simple interest in any Lot,
including contract sellers, but excluding those having an interest only as security for the
performance of an obligation. There may be more than one Owner of any single Lot.
2.25. "Recorded Document" shall mean any document, including any map or plat of survey,
recorded at the Office of the Register of Deeds of New Hanover County, North Carolina.
2.26. "Rules & Regulations" shall mean the initial rules and regulations for use and
occupancy of the Lots and the Common Areas set forth in Exhibit C, as they may be
supplemented, modified, restated or superseded pursuant to Article IV below.
2.27. "Special Assessments" shall mean assessments levied in accordance with Article 9
below.
2.28. "Specific Assessments" shall mean assessments levied in accordance with Article 9
below.
2.29. "Stormwater Control Facilities" shall mean one or more of the following devices and
measures, together with associated private drainage easements utilized for conveying stormwater
(however identified on a plat, map or in a recorded document) that serve(s) the Property and
which are located outside of public street rights -of -way and drainage easements accepted into
public use by New Hanover County, including, but not limited to, bio-cells, conduits, inlets,
channels, pipes, level spreaders, ditches, grassed swales, sand filters, wet ponds, dry detention
basins, wetlands, permanently protected undisturbed open space areas (and similarly designated
areas shown on any recorded plat of any portion of the Property), bio-retention areas, retention or
detention ponds, runoff and pollutants for more than one (1) Lot in the Property. Private
drainage easements, however identified on a recorded plat or recorded map or in a recorded
document, that serve more than one (1) Lot are deemed to be dedicated to the Association for the
benefit of the Property or applicable portions thereof.
2.30. "Supplemental Declaration" shall mean any declaration of covenants, conditions,
easements and/or restrictions that Declarant may file at the New Hanover County Registry
subsequently to filing this Declaration, which shall apply only to a particular area or areas within
the Community. Such Supplemental Declaration may supplement, change, amend or supersede
the terms and provisions of this Declaration as necessary to accommodate differences between
the plan of the development for the subject property and the plan of the development for the rest
of the Community.
Article III
Sidbury Station Community Association, Inc.
Every person or entity who is an owner of a fee or undivided fee simple interest in any of
the Lots shall be a Member of the Association. Ownership of such interest shall be the sole
qualification for membership, and membership shall be appurtenant to and shall not be separated
from such ownership.
Book 6540 Page 2873
The Association shall be organized and governed as follows:
3.1. P oses. The purposes of the Association shall be:
a. To maintain and preserve all Common Areas, and all roads, streets, decorative and
protective structures (including but not limited to entry monuments and buffer walls), ponds,
lakes, utilities, landscaped areas and other improvements located thereon, if any;
b. To enforce the provisions of the Governing Documents;
C. To perform all duties and functions allotted to owner's associations pursuant to
the Planned Community Act;
d. To promote and to protect the enjoyment and beneficial use and ownership of the
Lots; and
e. To promulgate and enforce the Rules and Regulations and administrative rules
and regulations for use of the Common Areas.
3.2. Powers and Responsibilities. The Association shall have all powers and responsibilities
and shall perform all duties and functions allotted to owner's associations by Article 3 of the
Planned Community Act, the terms and provisions of which are incorporated herein. The
Association shall also have all rights and powers and shall perform all duties and functions that
may be assigned to it by Declarant pursuant to this Declaration.
3.3 Voting Rights and Meetings. On matters of Association business submitted to vote of
the membership, there shall be two classes of membership:
Class A. Every person who is an Owner, with the exception of the Declarant, shall be a
Class A Member. Class A Members shall be entitled to one (1) vote per Lot. No more than one
vote per Lot may be cast by Class A Members, regardless of the number of Owners of a given
Lot.
Class B. The Declarant shall be the sole Class B Member. Class B membership shall be
a full voting membership and, during its existence, the Class B Member shall be entitled to vote
on all matters or issues before or considered by the Association. The Class B Member shall be
entitled to three (3) votes for each Lot it owns, plus one (1) vote for each Lot owned by a person
other than the Declarant. The Class B membership shall cease and shall be converted to Class A
membership at such time as the first of the following events occur: (i) the date that all the Lots in
the Community have been conveyed by the Declarant to other Owners; (ii) the surrender by the
Declarant of the right to appoint or remove any officer of the Association or member of the
Board by a Recorded Document executed by the Declarant; or (iii) the expiration of Declarant's
rights to appoint or remove any officer of the Association or member of the Board pursuant to
Article XI below.
Unless otherwise provided herein or in the Planned Community Act, all voting matters
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Book 6540 Page 2874
shall be decided by a simple majority vote. Requirements for a quorum shall be as provided by
the Bylaws. The Members shall meet as provided by the Bylaws.
3.4 Bylaws. The initial Board shall enact and adopt all and any Bylaws that they deem
necessary for the operation of the Association, which Bylaws shall be binding upon all Members,
their Mortgagees, lessees, agents and invitees.
Article IV
Use and Occupancy of Lots and Common Areas
4.1. Fundamental Restriction on Use.
The Lots and Common Areas shall be used for residential and related purposes only,
subject to and consistent with the Governing Documents, including the Rules and Regulations;
provided that Declarant, the Association and/or builders approved by Declarant may maintain a
business or management office within the Community, and provided that Declarant and/or any
brokers or builders approved by Declarant may maintain information centers, model homes and
sales offices within the Community. Notwithstanding the above, home business use ancillary to
the primary residential use of a Lot is permitted, subject to the Rules and Regulations and all
applicable laws and ordinances of governmental authorities.
4.2. Fundamental Restriction on Occupancy.
All Occupants of a single Lot shall be members of a single family. For purposes of this
Declaration, a single family unit is defined as a group of individuals related by blood, marriage,
adoption, or guardianship, or not more than three (3) persons not so related, living together as a
single housekeeping unit. The number of Occupants on each Lot shall also be reasonably limited
by the Lot's size and facilities and by a policy against disproportionate use of the Common
Areas.
4.3. Additional Restrictions on Use and Occupancy of Lots.
Use and occupancy of all Lots shall be restricted as follows:
4.3.1 Completion of Construction. Once construction of any structure located within
the Community is begun, it must be prosecuted diligently and must be completed within twelve
(12) months of its commencement, unless otherwise approved in writing by Declarant.
4.3.2 Subdivision of Lots. No dwelling shall be erected on less than one Lot and no
Lot shall be subdivided; however, owners of adjoining Lots may adjust a common boundary line,
provided that the adjustment conforms in all respects with all applicable governmental
regulations and ordinances, and with this Declaration.
4.3.3 Subdivision of Common Area. No Common Area shall be subdivided unless a
revised Preliminary Plat and a revised Final Plat showing such subdivision have been submitted
and approved by the governing municipality.
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Book 6540 Page 2875
4.3.4 Signs. No signs, billboard or other advertising of any kind shall be displayed to
public view on any Lot, right of way or Common Areas. This provision shall not apply to
marketing, construction, advertising or informational signs placed on any Lot, right of way or
Common Areas by Declarant. This provision shall not apply to professionally prepared signs
placed on any Lot which are used to advertise a Lot for sale or rent, provided that no such sign
shall be larger than 18" x 24". Although approval of the Association or the ARC is not required
prior to the display of such signs, the Association may itself remove, have removed, or require
the removal of any such sign which in its opinion would not otherwise be allowed under Article
5 of this Declaration or as amended or supplemented. A valid easement shall exist on any Lot for
such removal by the Association or its agents.
4.3.5 Refuse Storage. No Lot shall be used or maintained as a dumping ground for
rubbish of any character whatsoever, nor for the storage of any property or thing that will cause
such Lot to appear in an unclean or untidy condition or that will be obnoxious to the eye, nor
shall any substance, thing or material be kept upon any Lot that will emit foul or obnoxious
odors, or that will cause any noise that might disturb the peace, quiet, comfort or serenity of the
occupants of surrounding Lots. Trash, garbage or other waste shall not be burned or disposed of
on any Lot and shall be kept in sanitary containers approved by the ARC. All equipment for the
storage prior to disposal of such material shall be kept in a clean and sanitary condition. The
placement of containers shall be approved by the ARC and, in any event, shall be kept in an
enclosed area not subject to view from any person, from any direction.
4.3.6 Storage of Building Materials. No lumber, brick, stone, cinder block, concrete
block, cement or other materials used for building purposes shall be stored upon any Lot longer
than a reasonable time for the completion of the construction in which they are to be used.
4.3.7 Temporary Structures. No temporary structures such as sheds shall be erected or
placed on a Lot without the written approval of the Declarant or the Association. Such
structures, if permitted, may be used only during periods of construction, and never as a
residence.
4.3.8 Parking and Vehicle Storage. Only licensed and operative vehicles, classified as
passenger cars, station wagons, passenger pick-up trucks or passenger vans may be regularly
parked in driveways. No vehicle will be permitted to park regularly on any roadway within the
Community. Recreational vehicles must be screened from view. No vehicle located on a Lot
may be used as a dwelling, even temporarily.
4.3.9 Offensive Activities Prohibited. No noxious or offensive activity shall be
conducted upon any Lot or Common Areas, nor shall anything be conducted thereon tending to
cause embarrassment, discomfort, annoyance or nuisance to the neighborhood or to the
Occupants of any Lot.
4.3.10 Underground Utilities. All utility lines serving structures located on Lots shall be
placed underground.
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Book 6540 Page 2876
4.3.11 Mobile Homes and Manufactured Housing. No mobile home, trailer or
manufactured housing shall be located on any Lot.
4.3.12 Screening. Boats, boat trailers, golf carts, campers, antennae, clotheslines, pet
enclosures and the like shall not be located on a Lot so as to be visible from any roadway or any
other Lot. Boats and golf carts must be either parked in the garage or screened behind a fence at
least six (6) feet in height.
4.4 Rules and Regulations.
In addition to the restrictions stated above, which may be modified or rescinded only by
an amendment to this Declaration, use and occupancy of the Lots and Common Areas shall be
subject to the Rules and Regulations, which are intended to govern day-to-day use and occupancy
of the Lots and Common Areas. The initial Rules and Regulations are set forth in Exhibit C
attached hereto and incorporated herein. In order to adapt and respond to changing or unforeseen
circumstances affecting the Community, the Declarant, the Association and the Owners must
have the ability to change the Rules and Regulations in an expedited and inexpensive manner:
Accordingly, the Rules and Regulations may be amended, supplemented and/or rescinded and
restated as set forth in this Section 4.4.
4.4.1. Declarant's Authority. During the Declarant Control Period, the Declarant shall
have the unilateral right to amend, supplement and/or rescind and 'restate the Rules and
Regulations, without prior notice to the Association or to other Owners; provided that no
such action by Declarant may have a materially adverse effect on title to or marketability of any
Lot.
4.4.2. Board Authority. The Board may amend, supplement and/or rescind and restate
the Rules and Regulations. The Board shall send notice by mail or electronic notification to all
Members concerning any such proposed action at least five (5) business days prior to the Board
meeting at which such action is to be considered. Members shall have a reasonable opportunity
to be heard at a Board meeting prior to such action being taken. The Board's decision on such
action shall be final, subject only to subsection 4.4.1 above.
4.4.3. Members' Authority. Members representing more than Fifty percent (50%) of
the total votes in the Association, at an Association meeting duly called for such purpose, may
amend, supplement and/or rescind and restate the Rules and Regulations.
4.4.4. Conflicts. Nothing in this Article shall authorize the Board to modify, repeal or
expand the Architectural Guidelines or any provision of this Declaration. In the event of a
conflict between the Architectural Guidelines and the Rules and Regulations, the Architectural
Guidelines shall control. In the event of a conflict between this Declaration and the Rules and
Regulations, this Declaration shall control.
4.5. Limitations. The right and ability of the Declarant and the Board to amend,
supplement or restate the Rules and Regulations shall be limited as follows:
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Book 6540 Page 2877
4.5.1. Dis la s. The rights of Owners to display religious and holiday signs, symbols
and decorations inside structures on their Lots of the kinds normally displayed in single-family
residential neighborhoods shall not be abridged, but no such display may violate the Community -
Wide Standard or violate any other provision of this Declaration.
4.5.2. Activities Within Dwellings. No rule established pursuant to this Article shall
interfere with the activities carried on within the confines of dwellings, except that the
Association may restrict or prohibit any activities that create costs for the Association or other
Owners, that create a danger to the health or safety of others, that generate excessive noise, traffic
or use of parking facilities, that create unsightly conditions visible outside the dwelling or that
otherwise violate the provisions of this Declaration or any applicable governmental law,
ordinance or regulation.
4.5.3. Alienation. No rule promulgated pursuant to this Section shall prohibit leasing or
transfer of any Lot or require consent of the Association or Board for leasing or transfer of any
Lot; however, the Association may require a minimum lease term of six (6) months and
otherwise regulate the leasing of Lots, excepting any Lots subject to a mortgage which is insured
or guaranteed by the Federal Housing Administration or the Veterans Administration, or where
the provisions of this Section 4.5.3 are otherwise prohibited by law.
4.5.3 Abridging Existing Rights. No rule shall require an Owner to dispose of personal
property that was in or on a Lot prior to the adoption of such rule and which was in compliance
with all rules previously in force. This limitation shall _ apply only for the duration of such
Owner's ownership of the Lot personally, and this right shall not run with title to any Lot.
The limitations stated in this subsection shall not apply to amendments to this
Declaration.
4.6 Common Areas Administrative Rules.
The Board may promulgate and enforce administrative rules and regulations governing
use of the Common Areas without notice to the, Members or any hearing. Examples of such
administrative rules and regulations shall include, but not be limited to, setting hours of operation
of a recreational facility or allocating or reserving use of a facility by particular individuals at
particular times.
4.7 Notice to Purchasers and Mortgagees.
All prospective purchasers and mortgagees are given notice that use of the Lots and the
Common Areas is restricted and governed by the Rules and Regulations, as they may be
amended, expanded, and otherwise modified hereunder. Each Owner, by acceptance of a deed,
acknowledges and agrees that the use, enjoyment and marketability of his or her Lot shall be
affected by the Rules and Regulations which may change from time to time, and that the current
Rules and Regulations may not be set forth in a Recorded Document. Take notice that the
Declarant or the Association may have changed the initial Rules and Regulations since the
recording of this Declaration. The Association shall provide a copy of the current Rules and
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Book 6540 Page 2878
Regulations to any prospective purchaser Member or Mortgagee upon written request and
payment of the reasonable cost of such copy.
Article V
Architecture and Landscaping
5.1. General.
No structure or thing, including but not limited to fences, shall be placed, erected, or
installed upon any Lot and no improvements or other work (including staking, clearing,
excavation, grading, and other site work, exterior alterations of existing improvements, or
planting or removal of landscaping) shall take place on any Lot except pursuant to approval and
in compliance with this Article and the Architectural Guidelines.
No approval shall be required to repaint the exterior of a structure in accordance with
the originally approved color scheme or to rebuild in accordance with originally approved plans
and specifications. Any Owner may remodel, paint, or redecorate the interior of a dwelling
located on his or her Lot without approval; provided that modifications to the interior of a
dwelling visible from outside the structure shall be subject to approval.
Any improvements constructed on a Lot shall be designed by and built in accordance
with the plans and specifications of a licensed architect unless otherwise approved by Declarant
or its designee in its sole discretion.
This Article shall not apply to Declarant's activities or to the Association's activities
during the Declarant Control Period.
5.2 Architectural Review.
5.2.1. By Declarant. Each Owner, by accepting a deed or other instrument
conveying any legal or equitable interest in a Lot, acknowledges that, as the developer and
owner of real estate in the vicinity of and within the Community, Declarant has a substantial
interest in the quality and appearance of improvements within the Community, and in
determining that they enhance Declarant's reputation as a developer and do not impair
Declarant's ability to market, sell, or lease its property. Therefore, no Owner shall commence
any activity within the scope of this Article on his or her Lot unless and until Declarant or its
designee has given its prior written approval for such activity, which approval may be granted
or withheld in Declarant's or its designee's sole discretion.
In reviewing and acting upon any request for approval, Declarant or its designee shall act
solely in Declarant's interest and shall owe no duty to any other person. Declarant's rights
reserved under this Article shall continue or as long as Declarant owns any portion of the real
property described in Exhibit A or B or has the right to expand the Community pursuant to
Section 10.1, unless earlier terminated by Declarant by a Recorded Document.
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Book 6540 Page 2879
Declarant may, in its sole discretion, designate one or more persons from time to time to
act on its behalf in reviewing applications hereunder.
Declarant may from time to time, but shall not be obligated to, delegate all or a portion
of its reserved rights under this Article to any other person or committee. Any such delegation
shall be in writing, specifying the scope of responsibilities delegated, and shall be subject to (a)
Declarant's right to revoke such delegation at any time and reassume jurisdiction over the
matters previously delegated, and (b) Declarant's right to veto any decision which Declarant
determines, in its sole and exclusive discretion, to be inappropriate or inadvisable for any reason.
So long as Declarant has any rights under this Article, the jurisdiction of any other person or
committee shall be limited to such matters as are specifically delegated to it by Declarant.
5.2.2. Architectural Review Committee. Upon delegation by Declarant or upon
expiration of the Declarant Control Period, the Association, acting through an architectural
review committee ("ARC") appointed by the Board, shall assume jurisdiction over architectural
matters. The ARC shall consist of at least three (3), but not more than seven (7), persons who
shall serve and may be removed and replaced at the Board's discretion. The members of the
ARC need not be Members, and may, but need not, include architects, engineers, or similar
professionals, whose compensation, if any, the Board shall establish from time to time.
Unless and until such time as Declarant delegates all or a portion of its reserved rights to
the Association or expiration of the Declarant Control Period, the Association shall have no
jurisdiction over architectural matters.
5.3 Reviewer. For purposes of this Article, the committee or entity having jurisdiction
over architectural matters in a particular case shall be referred to as the "Reviewer." The
Reviewer may establish and charge reasonable fees for review of applications hereunder and
may require such fees to be paid in full prior to review of any application. Such fees may include
the reasonable costs incurred in having any application reviewed by architects, engineers, or
other professionals.
5.4 Guidelines and Procedures.
5.4.1 Architectural Guidelines. Declarant may prepare Architectural Guidelines
applicable to Lots which may contain general provisions applicable to all Lots as well as specific
provisions which vary among the Lots according to location, Neighborhood, use, or other
factors. The Architectural Guidelines are intended to provide guidance to Owners regarding
matters of particular concern to the Reviewer in considering applications hereunder. The
Architectural Guidelines are not the exclusive basis for the Reviewer's decisions, and
compliance with the Architectural Guidelines does not guarantee approval of any application.
Further, the Architectural Guidelines may be more restrictive than guidelines followed by New
Hanover County or as set forth in the International Builder's Code.
Declarant shall have sole and full authority to amend the Architectural Guidelines as
long as it owns any portion of the real property described in Exhibit A or B or has a right to
expand the Community pursuant to Section 10.1, notwithstanding a delegation of reviewing
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Book 6540 Page 2880
authority, unless Declarant also delegates the power to amend the Architectural Guidelines.
Upon termination or delegation of Declarant's right to amend, the ARC shall have the authority
to amend the Architectural Guidelines with the Board's consent. Any amendments to the
Architectural Guidelines shall be prospective only and shall not apply to require modifications
to or removal of structures previously approved once the approved construction or modification
has commenced. There shall be no limitation on the scope of amendments to the Architectural
Guidelines, and such amendments may remove requirements previously imposed or otherwise
make the Architectural Guidelines less restrictive.
The Association shall maintain a copy of the Architectural Guidelines, as they may exist
from time to time, and shall make them available to Members or Owners for inspection and
copying upon reasonable notice during the Association's business hours. In Declarants
discretion, such Architectural Guidelines may be recorded at the New Hanover County Registry,
in which event the recorded version, as it may be amended, shall control in the event of any
dispute as to which version of the Architectural Guidelines was in effect at any particular time.
5.4.2 Procedures. Except as the Architectural Guidelines otherwise specifically
provide, no activity described in Section 5.1 shall commence on any Lot until an application for
approval has been submitted to and approved by the Reviewer. Such application shall include
plans and specifications showing site layout, exterior elevations, exterior materials and colors,
landscaping, drainage, exterior lighting, irrigation, and other features of proposed construction,
as applicable. The Architectural Guidelines and the Reviewer may require the submission of
such additional information as deemed necessary to consider any application.
In reviewing each submission, the Reviewer may consider any factors it deems relevant,
including, without limitation, harmony of external design with surrounding structures and
environment. Decisions may be based solely on aesthetic considerations. Each Owner
acknowledges that determinations as to such matters are purely subjective and opinions may
vary as to the desirability or attractiveness of particular improvements. Subject to Declarant's
veto power described below, the Reviewer shall have the sole discretion to make final,
conclusive, and binding determinations on matters of aesthetic judgment. Such determinations
shall not be subject to review so long as they are made in good faith and in accordance with the
procedures described in this Article.
The Reviewer shall make a determination on each application within thirty (30) days
after receipt of a completed application and all required information. The Reviewer may (a)
approve the application, with or without conditions; (b) approve a portion of the application and
disapprove other portions; (c) disapprove the application; or (d) request further or additional
information. The Reviewer may, but shall not be obligated to, specify the reasons for any
objections or offer suggestions for curing any objections.
Until expiration of Declarant's rights under this Article, the ARC shall notify Declarant
in writing within three (3) business days after the ARC has approved an application. The notice
shall be accompanied by a copy of the application and any additional information which
Declarant may require. Declarant shall have ten (10) days after receipt of such notice to veto any
such action, in its sole discretion, by written notice to the ARC and the applicant.
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Book 6540 Page 2881
In any event, the Reviewer shall notify the applicant in writing of a final determination
within forty-five (45) days after its receipt of a completed application and all required
information. In the event that the Reviewer fails to respond in a timely manner, approval shall
be deemed to have been given, subject to Declarant's veto right. However, no approval, whether
expressly granted or deemed granted pursuant to the foregoing, shall be inconsistent with the
Architectural Guidelines unless the Reviewer has granted a variance pursuant to Section 5.6.
Notice shall be deemed to have been given at the time the envelope containing the
response is deposited with the U.S. Postal Service or sent via electronic notification. Personal
delivery of such written notice shall, however, be sufficient and shall be deemed to have been
given at the time of delivery to the applicant.
If construction does not commence on a project for which plans have been approved
within one (1) year after the date of approval, such approval shall be deemed withdrawn, and it
shall be necessary for the Owner to reapply for approval before commencing construction of any
proposed improvements. Once construction is commenced, it shall be diligently pursued to
completion. All work shall be completed within one year of commencement unless otherwise
specified in the notice of approval or unless the Reviewer grants an extension in writing, which
it shall not be obligated to do. If approved work is not completed within the required time, it
shall be considered nonconforming and shall be subject to enforcement action by the
Association, Declarant, or any aggrieved Member.
The Reviewer may by resolution exempt certain activities from the application and
approval requirements of this Article, provided such activities are undertaken in strict
compliance with the requirements of such resolution.
5.5 No Waiver of Future Approvals.
Each Owner acknowledges that the persons reviewing applications under this Article
will change from time to time and that opinions on aesthetic matters, as well as interpretation
and application of the Architectural Guidelines, may vary accordingly. In addition, each Owner
acknowledges that it may not always be possible to identify objectionable features until work is
completed, in which case it may be unreasonable to require changes to the improvements
involved, but the Reviewer may refuse to approve similar proposals in the future. Approval of
applications or plans, or in connection with any other matter requiring approval, shall not
constitute a binding precedent in any other matter or waiver of the right to withhold approval as
to any similar applications, plans, or other matters subsequently or additionally submitted for
approval.
5.6 Variances.
The Reviewer may authorize variances from compliance with any of its guidelines and
procedures when circumstances such as topography, natural obstructions, hardship, or aesthetic
or environmental considerations require, but only in accordance with duly adopted rules and
regulations. No variance shall (a) be effective unless in writing; (b) be contrary to this
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Book 6540 Page 2882
Declaration; or (c) estop the Reviewer from denying a variance in other circumstances. For
purposes of this Section, the inability to obtain approval of any governmental agency, the
issuance of any permit, or the terms of any financing shall not be considered a hardship
warranting a variance.
5.7 Limitation of Liabili
The standards and procedures this Article establishes are intended as a mechanism for
maintaining and enhancing the overall aesthetics of the Community; they do not create any duty
to any person. Review and approval of any application pursuant to this Article may be based on
aesthetic considerations only. The Reviewer shall not bear any responsibility for ensuring (a) the
structural integrity or soundness of approved construction or modifications, (b) compliance with
building codes and other governmental requirements, (c) that Lots are of comparable quality,
value, size, or of similar design, aesthetically pleasing, or otherwise acceptable to neighboring
property owners, (d) that views from any other Lots or the Common Areas are protected, or (e)
that no defects exist in approved construction.
Declarant, the Association, the Board, any committee, or any member of any of the
foregoing shall not be held liable for soil conditions, drainage, or other general site work; any
defects in plans revised or approved hereunder; any loss or damage arising out of the actions,
inaction, integrity, financial condition, or quality of work of any contractor or its subcontractors,
employees, or agents; or any injury, damages, or loss arising out of the manner or quality of
approved construction on or modifications to any Lot. In all matters, the Association shall
defend and indemnify the Board, the ARC, and any members thereof as provided in the Bylaws.
5.8 Certificate of Compliance.
Any Owner may request that the Reviewer issue a certificate of architectural compliance
certifying that such Owner's Lot has no known violations of this Article or the Architectural
Guidelines. The Association shall either grant or deny such request within thirty (30) days after
receipt of a written request and may charge a reasonable administrative fee for issuing such
certificates. Issuance of such a certificate shall stop the Association from taking enforcement
action with respect to any condition as to which the Association had notice as of the date of such
certificate.
5.9 View Impairment.
Neither Declarant nor the Association guarantee or represent that any view over and
across any portion of the Community or any adjacent property will be preserved without
impairment. Any additions or changes, whether occurring in the course of developing or
maintaining the Community, may diminish or obstruct any view from Lots and any express or
implied easements for view purposes or for the passage of light and air are hereby expressly
disclaimed.
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Book 6540 Page 2883
Article VI
Maintenance and Repair
6.1 General All areas within the Property and all areas covered by easements or
licenses owned or held by the Association shall be maintained to the Community -Wide Standard,
and to all other standards stated in this Declaration, any Supplemental Declaration and the
Bylaws, Rules and Regulations of the Association. The Association and the individual Owners
shall be responsible for such maintenance, as provided in this Article VI.
6.2 Association Responsibility Prior to their acceptance for public or private
maintenance, any roads, streets, walks, entranceways, cul-de-sacs, and utilities in the Community
shall be maintained by the Association. Such maintenance shall include repair and
reconstruction, when necessary. Maintenance of the roads, streets, entranceways and cul-de-sacs
in the Community shall conform to the standard of maintenance (if one is ascertainable) which
would be required by the North Carolina Department of Transportation or other governmental
entity before it would accept such roads, streets, entranceways and cul-de-sacs for maintenance.
The Association shall also maintain the following:
a. All landscaped rights -of -way and all entry features;
b. All Common Areas, and all landscaping, paving, streets, structures and
improvements of any nature located thereon; and
C. All ponds, streams and culverts located on the Property which serve as part of any
Stormwater Control Facilities.
6.3 Owner's Responsibility. Each Owner shall maintain his or her Lot and all unimproved
Common Areas along the boundaries of his or her Lot (e.g., area between lot line and curb).
Each owner shall maintain all landscaping, paving, structures and improvements of any nature
whatsoever located on his or her Lot. Each Owner's maintenance of his or her Lot and adjoining,
unimproved Common Areas shall include but not be limited to:
a. Keeping the area free and clear of all litter, trash, refuse and wastes;
b. Mowing lawns on a regular basis;
C. Pruning trees and shrubs;
d. Watering lawns;
e. Keeping exterior lighting and mechanical facilities in working order;
f. Keeping lawn and garden areas alive;
g. Removing and replacing any dead plant material;
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Book 6540 Page 2884
h. Keeping vacant land well maintained and free of trash and weeds;
i. Keeping parking areas and driveways in good repair;
j. Complying with all governmental health and police requirements;
k. Repainting of all structures; and
1. Repair of exterior damage to all structures.
6.4 Association's Right to Perform Owner's Responsibilitv. If any Owner or Occupant of
a Lot fails to perform any of the duties or responsibilities set forth in this subsection, then the
Association or Declarant may give such person written notice of such failure and such person
must within ten (10) days after receiving such notice (which notice shall be deemed to have been
received upon deposit in any official depository of the United States mail, addresses to the party
to whom it is intended to be delivered at that party's current address as shown by the records of
the Association, and sent by certified mail, return receipt requested), perform the care and
maintenance required or otherwise perform the duties and responsibilities of such Owner.
Should any such person fail to fulfill this duty and responsibility within such period, then the
Declarant or the Association, acting through its authorized agent or agents, shall have the right
and power to enter onto the Lot in question and perform such care and maintenance without any
liability for damages for wrongful entry, trespass or otherwise at any person. All Owner(s) of a
Lot on which such work is performed shall be liable for the cost of such work together with
interest on the amounts expended by the Association or the Declarant in performing such work
computed at the rate of twelve percent (12.00%) per annum from the date(s) such amounts are
expended until repaid to the Association or the Declarant, as the case may be, and for all costs
and expenses incurred in seeking the compliance of such Owner with his duties and
responsibilities hereunder, and shall reimburse the Association or the Declarant, as the case may
be, on demand for such costs and expense (including interest as above provided). If such Owner
shall fail to reimburse the Association or the Declarant, as the case may be, within thirty (30)
days after mailing to such Owner of a statement for such costs and expense by the Association or
Declarant, the Association has performed the work on the Lot of the delinquent Owner(s), the
Association may charge a Specific Assessment for such amounts against the Lot of such
Owner(s), and proceed to collect such Specific Assessment as provided in Article IX below.
6.5 Cost of Maintenance. All costs of the Association in meeting its responsibilities
pursuant to this Section shall be Common Expenses.
6.6 Conveyance of Common Areas to Association; No Implied Rights. Declarant, or the
owner of the property with the consent of the Declarant, may transfer or convey to the
Association at any time and from time to time any personal property and any interest in improved
or unimproved real property. Such conveyance shall be deemed to be accepted by the
Association upon delivery of any personal property or upon recordation with the New Hanover
County Registry of a non -warranty deed conveying any interest in real property, and the property
shall thereafter be Common Areas to be used and, if and as provided in this Article VI,
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Book 6540 Page 2885
maintained by the Association for the benefit of its Members. The Declarant shall not be
required to make any improvements whatsoever to property to be conveyed and accepted
pursuant -to this Section and shall have no duty or obligation to convey any property or property
rights to the Association regardless of whether or not any such property has been made available
for the use of Owners. Declarant, or the owner of the property with consent of Declarant, may
reserve, by lease, license, easement or otherwise such rights of use and enjoyment in and to all or
any portion of the property so conveyed as Declarant may reasonably require so long as such
reservation is not materially inconsistent with the overall scheme of development for the
Community. Neither the recordation of any subdivision plat nor the use by the Owners or
maintenance by the Association of any property shall create any rights, easements or licenses, in
the Association or the Owners, express or implied, unless and until any such property rights,
easements or licenses are conveyed by the Declarant or the owner of such property to the
Association or the Owners, as the case may be, by an instrument recorded in the Office of the
Register of Deeds of New Hanover County, North Carolina.
6.7 Liabili Owners, Occupants and their guests shall use the Common Areas and all
portions of the Community not contained within a Lot at their own risk and shall assume sole
responsibility for their personal belongings used or stored thereon. All Owners and Occupants
shall have an affirmative duty and responsibility to inspect the Common Areas and all portions of
the Community not contained within a Lot for any defects, perils or other unsafe conditions
relating to the use and enjoyment thereof. The Association, the Declarant and their respective
officers, directors, employees, representatives and agents shall not be held liable for personal
injury to any person, nor for loss or damage to personal belongings used or stored on any of the
foregoing property. The Association shall not be liable for injury or damage to any person or
property: (a) caused by the elements or by an Owner or any other person, (b) resulting from any
rain or other surface water which may leak or flow from any street, pipe, plumbing, drain,
conduit, appliance, equipment, security system, or utility line or facility, the responsibility for the
maintenance of which is that of the Association or from any portion of the Common Property, or
(c) caused by any street, pipe, plumbing, drain, conduit, appliance, equipment, security system, or
utility line or facility, the responsibility for the maintenance of which is that of the Association,
becoming out of repair. Nor shall the Association be liable to any Owner or Occupant for loss or
damage, by theft or otherwise, of any property of such Owner or Occupant.
Article VII
Insurance
7.1 Association's Responsibility.
7.1.1 The Association shall obtain and continue in effect the following types of
insurance, if reasonably available, or if not reasonably available, the most nearly equivalent
coverages as are reasonably available.
a. Blanket property insurance for all insurable improvements on the Common Areas
insuring against all risks of direct physical loss commonly insured against, including fire and
extended coverage perils. All property insurance policies the Association obtains shall have
policy limits sufficient to cover the full replacement cost of the insured improvements at the time
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Book 6540 Page 2886
of the insurance is purchased and at each renewal date, exclusive of land, excavations,
foundations and other items normally excluded from property policies. This coverage shall not,
however, include any improvements or betterments installed by an Owner or any of the personal
property belonging to an Owner. The Association shall be deemed trustee of all Members'
interests in all insurance proceeds paid to the Association under any such policies and shall have
full power to receive and to deal with such proceeds. The insurance proceeds shall be used by the
Association for the repair or replacement of the property for which the insurance was carried,
except as otherwise provided in this Section.
b. Commercial general liability insurance covering without limitation, liability for
personal injuries and activities in connection with the ownership, operation, maintenance, and
other use of the Common Areas. The Board shall use its business judgment in deciding upon per
occurrence limits for such coverage and shall consider any applicable secondary mortgage
guidelines relating to such coverage. The liability insurance shall name, as separately protected
insureds, Declarant, any property manager, the Association, the Board, the officers of the
Association, the ARC, and their respective representatives, members, agents, and employees with
respect to any liability arising out of the maintenance or use of the Common Areas.
C. Workers' compensation insurance and employers' liability insurance, if and to the
extent required by law.
d. Directors' and officers' liability coverage.
e. Commercial crime insurance, including fidelity insurance covering all persons
responsible for handling Association funds in an amount determined in the Board's business
judgment but not less than an amount equal to one -quarter of the annual Base Assessments on all
Lots plus reserves on hand. Fidelity insurance policies shall contain a waiver of all defenses
based upon the exclusion of persons serving without compensation.
f. Such additional insurance as the Board, in its business judgment determines
advisable.
7.1.2 Premiums for all insurance shall be Common Expenses unless the Board
reasonably determines that other treatment of the premiums is more appropriate. The
Association shall include such premiums in the assessments it levies. The Board shall review
the limits of all Association insurance policies at least once a year and shall adjust the policy
limits as the Board deems necessary or appropriate.
7.1.3 The Association shall arrange for a periodic review of the sufficiency of its
insurance coverage by one or more qualified persons, at least one of whom must be familiar
with replacement costs in the New Hanover County area. All Association policies shall provide
for a certificate of insurance to be furnished to the Association and, upon request, to each
Member insured.
7.1.4 The policies may provide for a reasonable deductible. In the event of an insured
loss, the deductible shall be treated as a Common Expense in the same manner as the premiums
for the applicable insurance coverage. However, if the Board reasonably determines, after notice
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Book 6540 Page 2887
and an opportunity to be heard in accordance with the Bylaws, that the loss is the result of the
negligence or willful misconduct of one or more Owners, their guests, invitees, or lessees, then
the Board may assess the full amount of such deductible against such Owner(s) and their Lots as
a Specific Assessment pursuant to Section IX below.
7.1.5 All insurance coverage obtained by the Board shall:
a. be written with a company authorized to do business in North Carolina which
satisfies the requirements of the Federal National Mortgage Association, or such other
secondary mortgage, market agencies or federal agencies as the Board deems appropriate and
carries a Best rating of AA or better;
b. be written in the name of the Association as trustee for the benefited parties.
(policies on the Common Areas shall be for the benefit of the Association and its Members);
c. not be brought into contribution with insurance purchased by Owners,
Occupants, or their Mortgagees individually;
d. contain an inflation guard endorsement;
e. include an agreed amount endorsement, if the policy contains a coinsurance
clause;
f, provide that each Owner is an insured person under the policy with respect to
liability arising out of such Owner's membership in the Association or interest in the Common
Areas as a Member in the Association (provided, this provision shall not be construed as giving
any Owner any interest in the Common Areas other than that of a Member);
g. include an endorsement precluding cancellation, invalidation, suspension or
non -renewal by the insurer conditioning recovery on account of an act or omission of any one or
more Owners, or on account of any curable defect or violation without prior written demand to
the Association to cure the defect or violation and allowance of a reasonable time to cure; and
h. include an endorsement precluding the insurer from denying a claim by an
Owner or conditioning recovery under the policy based upon or due to the negligent acts or
omissions of the Association or any other Owner.
7.1.6 In addition, the Board shall use reasonable efforts to secure insurance policies
which list the Owners (as a class) as additional insureds for claims arising in connection with
the ownership, existence, use or management of the Common Areas and provide:
a. a waiver of subrogation as to any claims against the Association's board of
directors, officers, employees and its manager, or the Owners and their tenants, servants, agents
and guests;
and
b. a waiver of the insurer's rights to repair and reconstruct instead of paying cash;
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Book 6540 Page 2888
c. an endorsement requiring at least 30 days' prior written notice to the Association
of any cancellation, substantial modification or non -renewal
7.2 Owner's Responsibility.
7.2.1 Each Owner of a Lot shall be responsible for obtaining and maintaining at all
times hazard insurance at their own expense covering all portions of the Owner's Lot, including
structures and improvements on the Lot and Owner's personal property. In addition, to the
extent not insured by policies of the Association or the extent insurable losses result in the
payment of deductibles under the Association's policies, every Owner shall obtain and maintain
at all times insurance covering consequential damages to any other Lot or the Common Areas
due to occurrences originating with the Owner's Lot and caused by the Owner's negligence, the
Owner's failure to maintain the Owner's Lot or any other casualty within the Lot, which caused
damage to any other Lot or Common Areas. Additionally, each Owner of a Lot may, at their
option, obtain insurance at their own expense to cover their personal liability, and to provide
such other coverage as they may desire
7.2.2 Owner's policies shall: (i) name the Association as an additional insured; (ii)
contain waivers of subrogation and of any reduction of pro rata liability of the insurer as a result
of any insurance carried by the Association or of any invalidity arising from any acts of the
Association or any other Owners; and (iii) shall provide that such policies may not be canceled
or substantially modified without at least thirty (30) days prior written notice to the Association.
At the Association's request, Owners shall file a copy of each individual policy or policies
covering their Lot and personal property with the Board within ten (10) days after receiving
such request. Such Owner shall promptly notify the Association in writing in the event such
policy is canceled.
7.2.3 No Owner shall do or keep anything on his/her Lot or on the Common Areas
which shall cause an increase in the premiums for or the cancellation of any insurance
maintained by the Association.
7.2.4 In the event that the Association is terminated pursuant to Section 17.2 herein, or
in the event that the Association otherwise defaults under its maintenance responsibilities for the
Stormwater Control Facilities, each Owner shall be jointly and severally responsible for
maintenance of the Stormwater Control Facilities, including payment of any unpaid ad valorem
taxes, public assessments for improvements, and unsafe building and public abatement liens
charged against the Stormwater Control Facilities and Lots benefitted by those Stormwater
Control Facilities, and including all interest charges thereon, together with the costs and
expenses of collection incurred by themselves (or other collecting agent), including court costs
and reasonable attorney's fees actually incurred. Each Owner has a right of contribution against
all other Owners whose portions of the Property are served by the same Stormwater Control
Facilities for payment of such costs and expenses to the extent that the Owner having such right
of contribution pays more than such Owner's pro rata share thereof, such pro rata share being
determined either dividing the acreage of such Owner's portion of the Property served by the
Stormwater Control Facilities by the total acreage of the portion of the Property served by the
same Stormwater Control Facilities when no maintenance assessments apply to the Property.
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Book 6540 Page 2889
Article VIII
Repair and Reconstruction
The Association shall have the authority and the duty to repair or reconstruct Common
Areas or other property which the Association is obligated to insure ("Insured Property") that is
damaged or destroyed unless such repair or reconstruction would be illegal under any state or
local ordinance governing health or safety, or Members representing at least eighty percent
(80%) percent of the total vote of the Association vote not to repair or reconstruct.
Except as otherwise provided in this Section, the Board shall diligently pursue to
completion the repair or reconstruction of that part of the Insured Property damaged or
destroyed. The Association may take all necessary or appropriate action to affect such repair or
reconstruction. Such repair or reconstruction shall be in accordance with the original plans and
specifications unless other plans are approved by the Board.
The proceeds of any insurance collected shall be available to the Association for the
purpose of repair or reconstruction of Insured Property. If the proceeds of insurance are
insufficient to pay the estimated or actual cost of such repair or reconstruction, then the Board,
pursuant to Section IX may levy in advance a Special Assessment sufficient to provide funds to
pay such estimated or actual costs of repair or reconstruction. Such assessment shall be allocated
and collected as provided in Article IX. Further levies may be made in like manner if the
amounts collected prove insufficient to complete the repair or reconstruction. The insurance
proceeds held by the Association and the amounts of any such Special Assessments shall
constitute a fund for the payment for costs of repair or reconstruction after casualty. If a balance
exists after payment of all costs of such repair or reconstruction, such balance shall be
distributed to the Owners of the Lots in proportion to the contributions made by each Owner to
the Association.
If a decision is made not to restore the damaged improvements and no alternative
improvements are authorized, the Association shall clear the affected property of all debris and
ruins and thereafter shall maintain such improvements in a neat and attractive, landscaped
condition consistent with the Community -Wide Standard. The cost of removal and landscaping
shall be paid for with insurance proceeds. The Association shall retain the remaining proceeds in
its general or other funds or shall allocate or distribute such funds as the Board determines
appropriate, provided any such distribution of insurance proceeds shall be proportionate to the
Members' interests.
Article IX
Assessments and Association Finances
9.1 Purpose of Assessments. The assessments provided for herein shall be used for the
general purposes of promoting the recreation, health, safety, welfare, common benefit, and
enjoyment of the Owners of Lots, including, without limitation, the maintenance of real and
personal property, all as may be more specifically authorized from time to time by the Board of
Directors. Furthermore, the Association shall be required to maintain an adequate reserve fund
for the periodic maintenance, repair, and replacement of the Stormwater Control Facilities out
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Book 6540 Page 2890
of the assessment levied. The maintenance of the Stormwater Control Facilities shall be a
Common Expense of the Association.
9.2 Creation of the Lien and Personal Obligation for Assessments. Each Owner of a Lot,
by acceptance of a deed therefor, whether or not it shall be so expressed in such deed, covenants
and agrees to pay to the Association any and all assessments levied by the Association
hereunder (including, without limitation, Base Assessments, Special Assessments, Specific
Assessments, and Neighborhood Assessments) and any other charges established pursuant to
the terms of this Declaration, including, but not limited to, reasonable fines as may be imposed
in accordance with the terms of this Declaration and the Bylaws. In addition to the foregoing,
the Board may charge each Owner a service, collection, consulting or administration fee (an
"Administrative Fee") in an amount to be determined by the Board from time to time in
connection with the assessment and collection of the assessments provided for in this
Declaration. The Administrative Fee shall include shall include charges for services of the
management company and any charges for credit reporting.
Each such assessment, together with late charges (in an amount determined by the Board
from time to time, but not to exceed the greater of Twenty and No/100 Dollars ($20.00) per
month or ten percent (10%) of any assessment installment unpaid or such higher amount as may
be permitted by the Act), interest (at a rate not to exceed the lesser of the maximum rate
permitted by law or eighteen percent (18%) per annum or such other amount as may be permitted
by the Planned Community Act), costs of collection, reasonable attorneys fees actually incurred
and any Administrative Fee, shall be the personal obligation of the person who was the Owner of
such Lot at the time the assessment fell due. Each Owner shall be personally liable for his or her
portion of each assessment coming due while he or she is the Owner of a Lot and his or her
successor -in -title shall be jointly and severally liable for such portion thereof as may be due and
payable at the time of conveyance; provided, further, however, the liability of a grantee for the
unpaid assessments of the grantor shall not apply to any First Mortgagee or other purchaser
taking title through foreclosure proceedings or deed in lieu of foreclosure.
No Owner may waive or otherwise be exempt from liability for the assessments provided
for herein, including, by way of illustration, but not limitation, abandonment of the Lot or non-
use of the Common Property. No diminution or abatement of any assessment shall be claimed or
allowed by reason of any failure of the Association to take some action or perform some function
required to be taken or performed by the Association, or for inconvenience or discomfort arising
from the making of repairs or improvements which are the responsibility of the Association, or
from any action taken by the Association to comply with any law, ordinance or directive of any
governmental or municipal authority, the obligation to pay assessments being a separate and
independent covenant on the part of each Owner. All payments shall be applied first to costs,
then to late charges, then to interest and then to delinquent assessments.
Assessments shall be paid at a uniform rate per Lot in such manner and on such dates as
may be fixed by the Board of Directors, which may include, without limitation, acceleration,
upon ten (10) days' written notice, of assessments for delinquents; provided however,
(a) notwithstanding any provision in this Declaration to the contrary, assessments to pay a
judgment against the Association may be made only against the Lots in the Community at the
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Book 6540 Page 2891
time the judgment was entered; and (b) if any common expense is caused by the negligence or
misconduct of any Owner or Occupant, the Association may assess the expenses exclusively
against that Owner's Lot, as more particularly set forth in Section 9.3 hereof.
All sums assessed against any Lot pursuant to this Declaration, together with late charges
(in an amount determined by the Board from time to time, but not to exceed the greater of
Twenty and No/100 Dollars ($20.00) per month or ten percent (10%) of any installment unpaid
or such higher amount as may be permitted by the Planned Community Act), interest on the
principal amount due (at a rate not to exceed the lesser of the maximum rate permitted by law or
eighteen percent (18%) per annum or such higher amount as provided in the Planned Community
Act), costs of collection, reasonable attorney's fees actually incurred and any Administrative Fee
when remaining unpaid for thirty (30) days or longer, shall be secured by a lien on such Lot in
favor of the Association when the Association files a claim of lien in the New Hanover County,
North Carolina clerk of court in the manner provided by law, if filing of such lien is required by
law, otherwise such lien shall automatically attach. Such lien shall be superior to all other liens
and encumbrances on such Lot, except for (i) liens and encumbrances recorded before the
docketing of the claim of lien, and (ii) liens for real estate taxes and other governmental
assessments and charges against the Lot. This Section does not affect the priority of mechanics'
or materialmens' liens.
All persons acquiring a lien or encumbrance on any Lot after this Declaration has been
recorded in the New Hanover County, North Carolina land records shall be deemed to consent
that such lien or encumbrance shall be inferior to future liens for assessments, as provided herein,
whether or not prior consent is specifically set forth in the instruments creating such lien or
encumbrance.
9.3 Budgeting and Allocating Common Expenses.
Until the Association first levies assessments, Declarant shall be responsible for all
Common Expenses. Thereafter, assessments for Common Expenses shall be levied at least
annually in accordance with this Article.
At least Sixty (60) days before the beginning of each fiscal year, the Board shall prepare
and approve a budget of the estimated Common Expenses for the coming year. The budget shall
include any contributions to be made to a reserve fund for repair and replacement of capital
assets, based on a separate reserve budget which takes into account the number and nature of
replaceable assets, the expected life of each asset and each asset's expected repair or
replacement cost. The budget shall reflect the sources and estimated amounts of funds to cover
such expenses, which may include any surplus to be applied from prior years, any income
expected from sources other than assessments levied against the Lots and the amount to be
generated through the levy of Base Assessments and Special Assessments against the Lots, as
authorized in Article IX. After the Declarant Control Period terminates, the annual Base
Assessments shall not be increased by an amount greater than twenty (20%) percent of the
annual Base Assessment of the immediately preceding calendar year.
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Book 6540 Page 2892
The Association is hereby authorized to levy Base Assessments equally against all Lots
subject to assessment to fund the Common Expenses. In determining the Base Assessment rate
per Lot, the Board may consider any assessment income expected to be generated from any
additional Lots reasonably anticipated to become subject to assessment during the fiscal year.
Base Assessments include any sums the Board determines necessary for the continued
ownership, operation and maintenance of the Common Property, operating expenses of the
Association, payment for any items of betterment and the establishment of reserve funds as the
Board shall deem proper. Base Assessments may include, without limitation, sums for property
taxes, insurance premiums, legal and accounting fees, management fees, charges for utilities and
other services provided by the Association, if any, cleaning and janitor services, landscape
maintenance, costs and expenses associated with the operation and maintenance of the storm
water drainage facilities and storm water detention/retention pond(s) in the Community, and
expenses and liabilities incurred as provided herein and in the Articles of Incorporation and
Bylaws for indemnification of officers and directors and in connection with the enforcement of
rights and duties of the Association against Owners and others.
Declarant may, but shall not be obligated to, reduce the Base Assessment for any fiscal
year by paying any deficit between the Common Expenses and Association funds collected
pursuant to the current year's budget, or any portion of any such deficit (in addition to any
amounts paid by Declarant under Section 9.7), which may be a contribution, an advance against
future assessments due from Declarant or a loan, in Declarant's discretion. Any such deficit
payment shall be disclosed as a line item in the income portion of the budget. Payment of such
deficit, or portion thereof, in any year shall not obligate Declarant to continue payment of such
deficit in future years, unless otherwise provided in a written agreement between the Association
and Declarant.
9.4 Special Assessments.
In addition to other authorized assessments, the Association may levy Special
Assessments to cover unbudgeted expenses or expenses in excess of those budgeted. Any such
Special Assessment may be levied against the entire membership. Except as otherwise
specifically provided in this Declaration, any Special Assessment shall require the affirmative
vote or written consent of a majority of the Board and the consent of Declarant during the
Declarant Control Period. Special Assessments shall be payable in such manner and at such
times as determined by the Board and may be payable in installments extending beyond the
fiscal year in which the Special Assessment is approved.
9.5 Specific Assessments.
The Board shall have the power to levy specific assessments as, in its discretion, it shall
deem appropriate. Failure of the Board to exercise its authority under this Section shall not be
grounds for any action against the Association and shall not constitute a waiver of the Board's
right to exercise its authority under this Section in the future with respect to any expenses,
including an expense for which the Board has not previously exercised its authority under this
Section. Fines levied pursuant to this Declaration, the capital contribution described below, and
the costs of maintenance performed by the Association for which the Owner is responsible shall
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Book 6540 Page 2893
be specific assessments. The Board of Directors may also specifically assess Owners for
Association expenses as follows: (a) expenses of the Association which are incurred to cover the
costs, including overhead and administrative costs, of providing services to Lots upon request of
an Owner pursuant to any menu of special services which the Association may offer; (b)
expenses of the Association which are incurred to cover costs incurred in bringing the Lot into
compliance with the Governing Documents, or costs incurred as a consequence of the conduct
of the Owner or Occupants of the Lot, their agents, contractors, employees, licensees, invitees,
or guests; and (c) expenses of the Association which are incurred as a result of the conduct of a
particular Owner or Occupant or the guests, tenants, invitees or licensees of such Owner or
Occupant may be assessed against the Lot of such Owner or Occupant.
9.6 Authority to Assess Owners; Time of Payment. Declarant hereby establishes and the
Association is hereby authorized to levy assessments as provided for in this Article and
elsewhere in the Governing Documents. The obligation to pay assessments shall commence as to
each Lot on the date that the Lot is first occupied for residential purposes. A Lot shall be deemed
to be occupied for residential purposes when it has been improved with a dwelling for which a
certificate of occupancy has been issued and has been conveyed to an Owner who intends to
occupy the dwelling, or, if the dwelling is occupied as a residence before such conveyance, the
date of such occupancy. Any Lot which has been approved by Declarant for use as a model
home for marketing and sales purposes shall not be deemed to be occupied for residential
purposes and shall not be subject to assessments under this Declaration whether owned by
Declarant or any other person, so long as such Lot is approved for use as a model home and is
not occupied for residential purposes. The first annual Base Assessment levied on each Lot shall
be adjusted according to the number of months remaining in the fiscal year at the time
assessments commence on the Lot.
Assessments shall be paid in such manner and on such dates as the Board may establish.
The Board may require advance payment of assessments at closing of the transfer of title to a Lot
and impose special requirements for Owners with a history of delinquent payment. If the Board
so elects, assessments may be paid in two or more installments. Unless the Board provides
otherwise, the Base Assessment shall be due and payable in advance on the first day of each
fiscal year. If any Owner is delinquent in paying any assessments or other charges levied on his
Lot, the Board may require the outstanding balance on all assessments to be paid in full
immediately.
9.7 Neighborhood Assessments. The Board may levy assessments against the property in
a particular Neighborhood to fund actual and estimated expenses incurred by the Association for
the primary benefit of property within such Neighborhood. Neighborhood assessments shall be
levied as specifically budgeted from time to time by the Board of Directors for expense items
such as maintenance, insurance or special services. In addition, the Board shall levy a
Neighborhood Assessment upon the request of the Owners holding two-thirds (2/3) of the total
association vote applicable to Lots within a Neighborhood.
9.8 Subordination of Liens to Mortgages. The lien of all assessments authorized herein is
hereby made subordinate to the lien of any first Mortgage if, but only if, all assessments and
charges with respect to such Lot authorized herein having a due date on or prior to the date of
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Book 6540 Page 2894
the Mortgage as filed of record have been paid. The lien hereby subordinated is only such lien
as relates to assessments and charges authorized hereunder having a due date subsequent to the
date such Mortgage- is filed of record and prior to the satisfaction, cancellation or foreclosure of
such Mortgage or the sale or transfer of the Lot pursuant to any proceeding in lieu of foreclosure
or the sale or transfer of the Lot pursuant to a sale under power contained in such Mortgage.
Such subordination is merely a subordination and shall not relieve the Owner of the Lot of the
personal obligation to pay all assessments coming due during such period of ownership; shall
not relieve such Lot from the lien provided for herein (except to the extent a subordinated lien is
extinguished as a result of such subordination as against a Mortgagee or such Mortgagee's
assignee or transferee by foreclosure or by sale under power); and no sale or transfer of such Lot
to the Mortgagee or to any other person pursuant to a decree of foreclosure, or pursuant to any
other proceeding in lieu of foreclosure or pursuant to a sale under power, shall relieve any
existing or previous Owner of such Lot of any personal obligation or relieve such Lot or the then
Owner of such Lot from liability for any assessment authorized hereunder that becomes due
after such sale and transfer.
9.9 Remedies of the Association. Any sums or charges (including assessments or
installments thereof) assessed against any Lot pursuant to this Declaration which are not paid
when due shall be delinquent. Any such sums delinquent for a period of more than ten (10)
days shall incur a late charge (in an amount determined by the Board from time to time, but not
to exceed the greater of Twenty and No/100 Dollars ($20.00) per month or ten percent (10%) of
any installment unpaid or such higher amount as may be permitted by the Planned Community
Act) and interest (at a rate not to exceed the lesser of the maximum rate permitted by law or
eighteen percent (18%) per annum or such higher amount as may be permitted by the Planned
Community Act). The Association shall cause a notice of delinquency to be given to any
member who has not paid within ten (10) days following the due date (the "Delinquency
Notice"). The Delinquency Notice shall state: (i) the outstanding balance due as of the date of
the Delinquency Notice; (ii) that the member has fifteen (15) days - from the mailing of the
Delinquency Notice (the "Grace Period") to pay the outstanding balance without being required
to pay attorneys fees and court costs; (iii) the name of and contact information for a
representative of the Association whom the member can contact to discuss a payment schedule
for the outstanding balance; provided however, the Association shall not be required to permit
payment of the outstanding balance in installments; and (iv) that if the outstanding balance is
not paid within the Grace Period, the Association intends to seek payment of attorneys' fees and
court costs. The Delinquency Notice must be sent by first class mail to the Lot of such member
and, if different, to the mailing address of the member in the Association's records. If any such
sums are not paid within thirty (30) days after the due date, the Board may accelerate and
declare immediately due all such sums (including annual assessments or installments thereof)
without any further notice being given to the delinquent Owner, and (i) to the extent permitted
by applicable law, a lien, as herein provided, shall attach; and (ii) a claim of lien, as herein
provided, may be filed in the New Hanover County, North Carolina clerk of court in the manner
provided by law. Such lien shall include, interest, all late charges from the date first due and
payable, any Administrative Fee, all costs of collection, and, if the Owner has been provided
with a Delinquency Notice and failed to pay the outstanding balance set forth therein within
fifteen (15) days from the mailing of the Delinquency Notice, court costs and reasonable
attorney's fees actually incurred, and any other amounts provided or permitted by law.
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Book 6540 Page 2895
Notwithstanding anything to the contrary in this Declaration, if a member does not
contest the collection of the unpaid assessments and enforcement of a lien after the expiration of
the Grace Period, then reasonable attorneys fees collected by the Association in connection with
such debt shall not exceed One Thousand Two Hundred and No/100 dollars ($1,200.00), or such
higher amount as may be permitted by the Planned Community Act, not including costs or
expenses incurred; provided however, such limitation shall not apply to judicial foreclosures or
to proceedings authorized under Section 116 (d) or Section 120 of Article 3 of the Planned
Community Act. The collection of the unpaid assessments and enforcement of the lien shall be
deemed uncontested as long as the member does not dispute, contest or raise any objection,
defense, offset or counterclaim as to the amount or validity of the unpaid assessments and lien
asserted or the Association's right to collect the debt and enforce the lien.
If any sum assessed against any Lot pursuant to this Declaration remains unpaid after
ninety (90) days from the due date, the Association may, as the Board shall determine, institute
suit to collect such amounts and/or vote to foreclose its lien. The Association may vote to
foreclose the claim of lien in like manner as a mortgage on real estate under power of sale under
Article 2A of Chapter 45 of the North Carolina General Statutes or in any other manner
permitted by applicable law; provided however, (i) the Association may not foreclose the lien
under Article 2A of Chapter 45 of the North Carolina General Statutes if the debt securing the
lien consists solely of fines imposed by the Association, interest on unpaid fines, or attorneys
fees incurred by the Association solely associated with fines imposed by the Association (such
lien may be enforced by judicial foreclosure as provided in Article 29A of Chapter 1 of the North
Carolina General Statutes); and (ii) any lien securing a debt consisting solely of Administrative
Fees may only be enforced by judicial foreclosure as provided in Article 29A of Chapter 1 of the
North Carolina General Statutes. Each Owner, by acceptance of a deed or as a party to any other
type of a conveyance, vests in the Association or its agents, to the extent permitted by this
Declaration and applicable law, the right and power to bring all actions against him or her,
personally, for the collection of such charges as a debt or to foreclose the aforesaid lien in the
same manner as a mortgage on real estate under power of sale under Article 2A of Chapter 45 of
the North Carolina General Statutes; or in any other manner permitted by applicable law. The
lien provided for in this Article shall be in favor of the Association and shall be for the benefit of
all other Owners. The Association, acting on behalf of the Owners, shall have the power to bid
on the Lot at any foreclosure sale or to acquire, hold, lease, mortgage or convey the same.
In addition to the foregoing, in the event that an Owner is at least thirty (30) days
delinquent in the payment of any assessment or charge owed to the Association, the Association
may suspend the right of such Owner to vote, suspend the right of such Owner to use and enjoy
the Common Property and the suspend any services or utilities which may be provided to Lots in
the Community, subject to any notice requirements imposed by the institutional providers
providing such services or utilities in the Community and in accordance with the notice and
hearing procedure in the Bylaws.
9.10 Budget Deficits During Declarant Control.
During the Declarant Control Period, Declarant may (but shall not be required to):
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Book 6540 Page 2896
a. Declarant may advance funds to the Association sufficient to satisfy the deficit, if
any, between the Association's actual operating expenses and the sum of the Base, Special,
Neighborhood, and Specific Assessments collected by the Association in any fiscal year. Such
advances shall, upon request of Declarant, be evidenced by promissory notes from the
Association in favor of Declarant. Declarant's failure to obtain a promissory note shall not
invalidate the debt.
b. Declarant may cause the Association to borrow any amount from a third party at
the then prevailing rates for such a loan in the local area of the Community. Declarant, in its sole
discretion, may guarantee repayment of such loan, if required by the lending institution, but no
Mortgage secured by the Common Areas or any of the improvements maintained by the
Association shall be given in connection with such loan.
Declarant may acquire property for, or provide services to, the Association or the
Common Areas. Declarant shall designate the value of the property or the services provided, and
such amounts, at Declarant's request, shall be evidenced by a promissory note. Failure to obtain
a promissory note shall not invalidate the obligation referred to in this Section.
9.11 Failure to Assess. The omission or failure of the Board to fix the assessment amounts
or rates or to deliver or mail to each Owner an assessment notice shall not be deemed a waiver,
modification, or a release of any Owner from the obligation to pay assessments. In such event,
each Owner shall continue to pay assessments on the same basis as for the last year for which an
assessment was made, if any, until a new assessment is made, at which time any shortfalls in
collections may be assessed retroactively by the Association.
9.12 Statement of Account.
Upon written request of any Member, Mortgagee, prospective Mortgagee or prospective
purchaser of a Lot, the Association shall issue a written statement setting forth the amount of the
unpaid assessments, if any, with respect to such Lot, the amount of the current periodic
assessment and the date on which such assessment becomes or became due, and any credit for
advanced payments or prepaid items. Such statement shall be delivered to the requesting person
personally or by certified mail, first-class postage prepaid, return receipt requested. The
Association may require the payment of a reasonable processing fee for issuance of such
statement.
Such statement shall bind the Association in favor of persons who rely upon it in good
faith. Provided such request is made in writing, if the request for a statement of account is not
processed within fourteen (14) days of receipt of the request, all unpaid assessments that became
due before the date of making such request shall be subordinate to the lien of a Mortgagee that
acquires its interest after requesting such statement.
9.13 Exempt Property.
The following property shall be exempt from payment of Base Assessments, Specific
Assessments, Neighborhood Assessments, and Special Assessments:
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Book 6540 Page 2897
a. all Common Areas;
b. any property dedicated to and accepted by any governmental authority or
public utility; and
C. any and all property owned by the Declarant.
9.14 Capitalization of Association.
Upon the sale of each Lot in the Community after it has been improved with a residence
for which a certificate of occupancy has been issued, a capital contribution in an amount as
determined by the Board from time to time shall be collected from the purchaser at the closing of
such sale for the benefit of the Association (or if not collected at the closing, shall be paid
immediately on demand by the Association). This capital contribution shall be a Specific
Assessments against the Lot and shall be in addition to, not in lieu of, the annual Base
Assessment. The capital contribution shall not be considered an advance payment of the annual
Base Assessment. The capital contribution may be established, increased or decreased in the sole
and exclusive discretion of the Board.
Article X
Expansion of the Community
10.1. Expansion by Declarant.
Until all property described in Exhibit B has been subjected to this Declaration or
twenty (20) years after the recording of this Declaration, whichever is earlier, Declarant reserves
the right, but not the obligation, to subject unilaterally to the provisions of this Declaration all or
any portion of the real property described in Exhibit B which Declarant currently owns or to
which Declarant may obtain title in the future. Declarant may transfer or assign this right to
subject property to this Declaration, provided that the transferee or assignee is the developer of
or owns at least a portion of the real property described in Exhibit B, and provided that the
transfer or assignment is evidenced by a Recorded Document.
Declarant shall subject additional property to this Declaration by recording an
Annexation Declaration describing the property being subjected. Such Annexation Declaration
shall not require the Members' consent but shall require the consent of the owner of such
property, if other than Declarant. Any such annexation shall be effective upon the recording of
such Annexation Declaration unless otherwise provided therein.
10.2. Expansion by the Association.
Upon termination of the Declarant Control Period, the Association may subject any real
property to the provisions of this Declaration with the consent of the owner of such property, if
authorized by the affirmative vote of Members representing sixty-seven percent (67%) of the
total existing votes in the Association.
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Book 6540 Page 2898
The Association shall subject such property by recording an Annexation Declaration
describing the property being subjected. Any such Annexation Declaration shall be executed by
the Association and the owner of the subject property, and shall be certified by the Secretary of
the Association to have been authorized by the requisite vote of the Members of the Association.
10.3. Withdrawal of Property.
Declarant reserves the right to amend this Declaration so long as it has a right to annex
additional real property to the Community pursuant to this Article for the purpose of removing
any portion of the Community then owned by Declarant or the Association from the coverage of
this Declaration, to the extent originally included in error or as a result of any changes
whatsoever in the plans for the Community, provided such withdrawal is not unequivocally
contrary to the overall, uniform scheme of development for the Community. Any such
withdrawal shall be accomplished by filing an amendment to the Declaration executed by
Declarant describing the property to be removed. Such amendment shall be executed by the
Declarant and the owner(s) of the property being removed if said property is not owned by the
Declarant and shall not require the vote or consent of members of the Association and shall be
effective upon the filing of record in the Office of the Register of Deeds of New Hanover
County unless a later effective date is provided therein.
Article XI
Declarant Rights
11.1. Reasonable Rights To Develop.
Declarant, builders approved by Declarant and/or their contractors or subcontrators may
construct improvements to or within the Community including to the Lots. The completion of
such construction and the sale or other disposal of the Lots is essential to the establishment and
welfare of the Community. Therefore, during the Declarant Control Period, nothing in this
Declaration or the other Governing Documents shall be construed to:
a. prevent Declarant, approved builders, or their contractors or subcontractors from
doing whatever is reasonably necessary or advisable in connection with the commencement or
completion of the above -described work throughout the Community;
b. prevent Declarant or its representatives from erecting, constructing, and
maintaining anywhere in the Community such structures as reasonably may be
necessary for the conduct of its business of completing the work, establishing
Sidbury Station as a residential Community and disposing of the Lots by sale,
lease, or otherwise;
C. prevent Declarant and/or builders approved by Declarant from maintaining such
signs and conducting such activities in any part of the Community owned by Declarant and/or
builders approved by Declarant as Declarant and/or builders may deem to be reasonably
necessary for the sale, lease, or disposition of Lots; or
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Book 6540 Page 2899
d. prevent Declarant and/or builders approved by Declarant from placing and
utilizing on Lots or other property which it owns one or more mobile trailers or temporary
structures as sales offices or for construction activities.
Nothing in this Section shall give Declarant and/or builders approved by Declarant the
right to damage any Lot or other property not owned by Declarant and/or builders approved by
Declarant.
11.2. Marketing and Sales Activities.
During the Declarant Control Period, Declarant and builders approved by Declarant may
construct, relocate, maintain and carry on upon any Lot Declarant owns, the builder owns or
upon portions of the Common Areas, such facilities and activities as may be reasonably
required, convenient or incidental to the construction, marketing or sale of Lots, as determined
in Declarant's sole opinion. Such facilities and activities may include, without limitation,
business offices, signs, model homes, and sales offices. There shall be no limit on the number or
size of such facilities. Declarant and builders approved by Declarant shall have easements for
access to and use of such facilities. Declarant reserves the right to remove any personal property
used in connection with its activities on the Common Areas upon termination of its rights under
this Section.
11.3. Construction of Improvements.
During the Declarant Control Period, Declarant and its employees, agents and designees
shall have a right of access and use and an easement over and upon all of the Common Areas for
the purpose of making, constructing and installing such improvements to the Common Areas as
it deems appropriate in its sole discretion.
11.4. Right to Approve Additional Covenants.
During the Declarant Control Period, no person or entity shall record any declaration of
covenants, conditions, easements and restrictions, or similar instrument affecting any portion of
the Community without Declarant's prior written approval. Any instrument recorded without
such consent shall be void and of no force and effect unless Declarant subsequently consents in
a Recorded Document.
11.5. Right to Transfer or Assign Declarant Rights.
Any or all of Declarant's rights or obligations set forth in this Declaration or the Bylaws
may be transferred in whole or in part to other persons; however, the transfer shall not reduce
an obligation or enlarge a right beyond that which Declarant has under this Declaration or the
Bylaws. No such transfer or assignment shall be effective unless evidenced by a Recorded
Document. The foregoing sentence shall not preclude Declarant from permitting other persons
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to exercise, on a one-time or limited basis, any right reserved to Declarant in this Declaration
where Declarant does not intend to transfer such right in its entirety. In such case it shall not be
necessary to record any written assignment unless necessary to evidence Declarant's consent to
such exercise.
11.6. Exclusive Rights to Use Name of Development.
During the Declarant Control Period, no person or entity shall use the name "Sidbury
Station" or any derivative of such name in any printed or promotional material without
Declarant's prior written consent. However, Owners may use the name "Sidbury Station" in
printed or promotional matter where such term is used solely to specify that particular property
is located within the community and the Association shall be entitled to use the word "Sidbury
Station" in its name.
11.7. Rightto Approve Changes in Community Standards.
During the Declarant Control Period, no amendment to or modification of any Rules and
Regulations or Architectural Guidelines shall be effective without Declarant's prior written
approval.
11.8. Easement to Inspect and Right to Correct
11.8.1. Easement. Declarant reserves for itself, the Association, and such other persons
as it may designate perpetual non-exclusive easements throughout the Community to the extent
reasonably necessary for the purposes of accessing, inspecting, testing, redesigning or correcting
any portion of the Community including Lots and Common Areas. Declarant shall have the right
to redesign or correct any part of the Community, including Lots owned by Declarant and
Common Areas.
11.8.2. Right of Entry_. Entry onto a Lot shall be after reasonable notice, except in an
emergency. Entry into a structure on a Lot shall be only after Declarant notifies the Lot's Owner
and agrees with the Owner regarding a reasonable time to enter the structures on such Lot to
perform such activities.
11.8.3. Damage. Declarant shall promptly repair any damage to a Lot or the Common
Areas resulting from the exercise of the easement or right of entry described in subsections
11.8.1 and 11.8.2 of this Section at its own expense. The exercise of these easements shall not
unreasonably interfere with the use of any Lot, and entry onto any Lot shall be made only after
reasonable notice to the Owner or Occupant.
11.9 Neighborhoods.
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Book 6540 Page 2901
During the Declarant Control Period, Declarant, acting in its sole and absolute
discretion, shall have the right, but not the obligation to establish separately developed
residential Neighborhoods, recreational areas and amenity areas, or some, all or none of these,
within the Community, and to designate Limited Common Area for the exclusive use of one or
more, but less than all of Neighborhoods. Every Lot situated within a designated Neighborhood
may be subjected to additional covenants, conditions, restrictions and additional assessments for
services provided to Lots within such designated Neighborhood. Such additional covenants may
be set forth in this Declaration or a Supplemental Declaration.
Any Neighborhood may request that the Association provide a higher level of service
than that which the Association generally provides to all Neighborhoods, or may request that the
Association provide special services for the benefit of Lots in such Neighborhood. Upon the
affirmative vote, of the Owners of a majority of the Lots within the Neighborhood, the
Association shall provide the requested services. The cost of such services, which may include a
reasonable administrative charge in such amount as the Board deems appropriate (provided, any
such administrative charge shall apply at a uniform rate per Lot to all Neighborhoods receiving
the same service), shall be a Neighborhood Assessment.
11.10 Appointment or Removal of Members of the Board and officers. During the
Declarant Control Period, Declarant shall have the right to appoint or remove any member of
the Board or officer of the Association.
11.11 Amendment to Declaration. During the Declarant Control Period, Declarant shall
have the right to amend or rescind and restate this Declaration by a Recorded Document,
without approval or joinder of the Association or any other Party.
11.12 Review of Design and Construction. During the Declarant Control Period, Declarant
shall have the right to control the design, quality, installation and construction of improvements
within the Community as provided in Article V above.
Article XII
Easements
12.1 Owners' Easements of EnjoyMe Except as limited by this Declaration and the
Planned Community Act, every Owner shall have a right of use and enjoyment in and to the
Common Areas which shall be appurtenant to and shall pass with the title to every Lot. Except
as limited by this Declaration and the Planned Community Act, any Owner may delegate his
rights of use and enjoyment of the Common Areas to the members of his family, his tenants,
contract purchasers who reside on the Property, or his guests.
12.2 Walks, Drives, Parking Areas, and Utilities. All areas of the Community shall be
subject to such easements for driveways, walkways, parking areas, water lines, sanitary sewers,
storm drainage facilities and for the maintenance of and general access to all stormwater control
structures, gas lines, telephone and electric power lines, television antenna lines, other utilities,
ingress, egress and regress and otherwise as shall be established by the Declarant or by its
predecessor in title, prior to the conveyance of the Property designated to be the Common Areas
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Book 6540 Page 2902
to the Association; and the Association shall have the power and authority to grant and establish
further easements upon, over, under, and across the Common Areas.
12.3 Encroachments and Declarant's Easement to Correct Drainage. All Lots and the
Common Areas shall be subject to easements for the encroachment of initial improvements
constructed on any Lots or Common Areas to the extent that such initial improvements actually
encroach, including, without limitation, such items as overhanging eaves, gutters, downspouts,
exterior storage rooms, bay windows, steps and walls. For a period of twenty-five (25) years
from the date of conveyance of the first Lot in a parcel or section, the Declarant reserves a
blanket easement and right-of-way on, over, and under the ground within that parcel, phase or
section to maintain and to correct drainage or surface water in order to maintain reasonable
standards of health, safety and appearance. Such rights expressly include the right to cut any
trees, bushes or shrubbery, make any gradings of the soil or take any other similar action
reasonably necessary. After such action has been completed, the Declarant shall restore the
affected Property to its original condition to the extent practicable. Declarant shall give
reasonable notice of intent to take such action to all affected owners. These rights and
reservations are assignable by the Declarant.
12.4 Easement for Entry Features. There is hereby reserved to the Declarant and the
Association an easement for ingress, egress, installation, construction landscaping and
maintenance of entry features and similar streetscapes for the Community, over and upon each
Lot and all Common Areas. The easement and right herein reserved shall include the right to cut,
remove and plant trees, shrubbery, flowers and other vegetation around such entry features and
the right to grade the land under and around such entry features.
12.5 Construction and Sale Period Easement. Notwithstanding any provisions contained in
the Declaration, the Bylaws, the Articles of Incorporation, use restrictions, rules and regulations,
design guidelines, and any amendments thereto, until Declarant's right unilaterally to subject
property to this Declaration terminates and thereafter so long as Declarant owns any property in
the Community for development or sale, Declarant reserves an easement across the Community
for Declarant and any builder or developer approved by Declarant to maintain and carry on
development, construction, and sales activities related to property within or near the Community,
upon such portion of the Community as Declarant may reasonably deem necessary. This
reserved easement shall include an easement for such facilities and activities which, in the sole
opinion of Declarant, may be required, convenient or incidental to the development, construction
and sales activities related to property within or near the Community. This easement shall
include, without limitation: (i) the right of access, ingress and egress for vehicular and pedestrian
traffic and construction activities over, under, on or in any portion of the Community as well as
any Lot in the Community; (ii) the right to tie into any portion of the Community with driveways,
parking areas and walkways; (iii) the right to tie into or otherwise connect and use (without a tap -
on or any other fee for doing so), replace, relocate, maintain and repair any device which
provides utility or similar services; (iv) the right (but not the obligation) to construct recreational
facilities on the Common Areas; (v) the right to carry on sales and promotional activities in the
Community; (vi) the right to place direction and marketing signs on any portion of the
Community, including any Lot or Common Areas; and (vii) the right to construct and operate
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Book 6540 Page 2903
business offices, signs, construction trailers, model residences, and sales offices incidental to the
construction, development and sales activities. Further, the Declarant and any builder or
developer authorized by Declarant, may use residences, offices or other buildings owned or
leased by Declarant or such builder or developer as model residences and sales offices, and may
also use recreational facilities available for use by the Community as a sales office or for
marketing purposes without charge. Rights exercised pursuant to such reserved easement shall
be exercised with a minimum of interference to the quiet enjoyment of affected property, and
reasonable steps shall be taken to protect such property from damage. Any damage shall be
repaired by the person causing the damage at -its sole expense. This section shall not be amended
without the Declarant's express written consent until the Declarant's rights hereunder have
terminated as provided in this Declaration.
12.6 Irri ag tion. There is hereby reserved to the Declarant and the Association a blanket
easement to pump water from ponds, lakes and other bodies of water located within the
Community for irrigation purposes.
12.7 Fence Easement Declarant hereby reserves an easement across any Lot which
borders upon or contains a portion of any water facility, detention pond, or retention pond for the
purpose of access to such facility or pond, and for the purpose of erecting any fence which is
either required by the subdivision development and construction plans or governmental
regulation, rule, ordinance, or plan approval requirement.
12.8 Easement to Government Entities. An easement is hereby established for municipal,
State or public utilities serving the area, their agents and employees, over all Common Areas
hereby or hereafter established for setting, removing and reading utility meters, maintaining and
replacing utility connections, and acting with other purposes consistent with the public safety and
welfare, including, without limitation, garbage collection, mail delivery, police and fire
protection.
12.9 Easement and Right of Entry for Repair. Maintenance and Reconstruction. If any
dwelling is located closer than four (4) feet from its lot line, the Owner thereof shall have a
perpetual access easement over the adjoining lot to the extent reasonably necessary to perform
repair, maintenance or reconstruction of his home. Such repair, maintenance or reconstruction
shall be done expeditiously and, upon completion of the work, the Owner shall restore the
adjoining Lot to as near the same condition as that which existed prior to the commencement of
the work as is reasonably practicable.
12.10 Pedestrian Easements. To the extent that they are not maintained by the Owners of
those portions of the Properties on which they are located, the Association shall maintain all
Pedestrian Access Easements required to be located on any portion of the Properties pursuant to
approved subdivision plan approvals and/or pursuant to plats of the Properties recorded in the
register of deeds of the county in which the Property is located, and/or pursuant to written
maintenance agreements with the municipal or county authorities.
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Book 6540 Page 2904
12.11 Right of the Association and Declarant to Enter Upon the Common Areas. Declarant
hereby reserves for the benefit of itself, its successors in interest and assigns, and grants to the
Association and all agents, employees or other designees of Declarant or the Association an
easement for ingress, egress and access to enter upon or over the Common Areas for the purposes
of inspecting any construction, proposed construction, or improvements or fulfilling the rights,
duties and responsibilities of ownership, administration, maintenance and repair of Declarant or
the Association, as appropriate. Such easement includes an easement in favor of the Association
and Declarant to enter upon the Common Areas now or hereafter created to use, repair, maintain
and replace the same for the purposes for which they are initially designated or for such purposes
as they are hereafter redesignated or as Declarant otherwise determines them to be reasonably
suited. Notwithstanding the foregoing, nothing contained herein shall be interpreted as imposing
any obligation upon the Association or Declarant to maintain, repair, or construct improvements
which an Owner is required to maintain, construct or repair.
12.12 Right -of -Way Over Roadways. Declarant hereby reserves, for the benefit of itself, its
agents, employees, lessees, invitees, designees, successors and assigns, and grants to the
Association, its agents, employees, tenants, invitees, designees, successors and assigns, and to
each Owner of a Lot, their family members, tenants, guests, invitees, successors and assigns, and
to each Occupant of a Lot and to all governmental and quasi -governmental agencies and service
entities having jurisdiction over the Property while engaged in their respective functions, a
perpetual, non-exclusive easement, license, right and privilege of passage and use, both
pedestrian and vehicular, over and across any roads, streets, entranceways and cul-de-sacs in the
Community for the purpose of providing access, ingress and egress to and from, through and
between the Property.
12.13 Utility and Drainage Easements. The Property shall be subject to all easements and
rights -of -way for utilities and drainage shown on any Recorded Document. Such easements are
hereby reserved for the use of Declarant, its successors and assigns, and are hereby established
for the use of the Association, its successors and assigns. Additionally, Declarant hereby
reserves, for the benefit of itself, its successors and assigns, and grants to the Association, its
successors and assigns, a non-exclusive easement and right-of-way over, under and along all Lots
within the Property for the installation and maintenance of lines, conduits, pipes and other
equipment necessary for furnishing electric power, gas, telephone service, cable service, water,
irrigation, sanitary sewer and drainage facilities, storm drainage and/or other utilities. Within the
above -described easements no structure, planting or other material shall be placed or permitted to
remain which may damage or interfere with the installation of utilities or which may change the
direction or flow of drainage channels in the easements. This reservation of easement shall not
prohibit the construction of driveways, at locations approved by the ARC, over such easements.
12.14 Declarant's Right to Assign Easements, Maintenance of Easement Areas. Declarant
shall have the right to assign and convey, in whole or in part, the easements reserved by it
hereunder. The areas burdened by the easements and rights -of -way reserved by Declarant on
each Lot or other portion of the Property pursuant hereto, including any improvements in such
areas, which are not to be maintained by the Association or a public authority or utility, shall be
maintained continuously by each Owner of such Lot or other portion of the Property, but no
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structures, plantings or other material shall be placed or permitted to remain upon such area or
other activities undertaken thereon which may damage or interfere with the installation or
maintenance of utilities or other services, or which may retard, obstruct or reverse the flow of
water or which may damage or interfere with established slope ratios or create erosion problems.
12.15 Easement Reserved for the Association and Declarant. Full rights of access, ingress
and egress are hereby reserved by Declarant for itself and the Association at all times over and
upon any Lot or other portion of the Property for the exercise of the easement rights described in
this Article XII and for the carrying out by Declarant or the Association of the rights, functions,
duties and obligations of each hereunder; provided, that' any such entry by Declarant or the
Association upon any Lot or portion of the Property shall be made with the minimum
inconvenience to the Owner of such property as is reasonably practical, and any damage caused
as a result of the gross negligence of Declarant, the Association or their employees or agents shall
be repaired by Declarant or the Association, as the case may be, at the expense of Declarant or
the Association, as the case may be.
12.16 Additional Easements. Declarant shall have the right to grant over, under, across and
upon any portion of the Property owned by Declarant, and the Board shall have the authority, in
its sole discretion, to grant over, under, across and upon the Common Areas, such easements,
rights -of -way, licenses and other rights in accordance with or to supplement the provisions of this
Declaration or as may otherwise be desirable for the development of the Community, by the
execution, without further authorization, of such grants of easement or other instruments as may
from time to time be necessary or desirable. Such easements may be for the use and benefit of
persons who are not Members or Owners. After such time as the members of the Board are no
longer appointed by Declarant, the Board shall cooperate with Declarant and execute such grants
of easements over the Common Areas as may be desirable to Declarant .for the development of
the Community and the preservation and enhancement of Declarant's interest therein.
12.17 Stormwater Restrictions. The following covenants are intended to ensure ongoing
compliance with State Stormwater Permit Number SW8 200705, as issued by the Division of
Energy, Mineral and Land Resources under NCAC 2H.1000:
12.17.1. The State of North Carolina is made a beneficiary of these covenants to the
extent necessary to maintain compliance with the stormwater management permit.
12.17.2. These covenants are to run with the land and be binding on all persons and
parties claiming under them.
12.17.3. The covenants pertaining to stormwater may not be altered or rescinded
without the express written consent of the State of North Carolina, Division of Energy, Mineral
and Land Resources.
12.17.4. Alteration of the drainage as shown on the approved plans may not take
place without the concurrence of the Division of Energy, Mineral and Land Resources.
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Book 6540 Page 2906
12.17.5. The maximum allowable built -upon area is 4,000 square feet. This allotted
amount includes any built -upon area constructed within the lot property boundaries, and that
portion of the right-of-way between the front lot line and the edge of the pavement. Built upon
area includes, but is not limited to, structures, asphalt, concrete, gravel, brick, stone, slate,
coquina and parking areas, but does not include raised, open wood decking, or the water surface
of swimming pools.
12.17.6. Each Lot will maintain a fifty foot (50') wide vegetated buffer between all
impervious areas and surface waters.
12.17.7. All runoff from the built -upon areas on the Lot must drain into the
permitted system. This may be accomplished through a variety of means including roof drain
gutters which drain to the street, grading the lot to drain toward the street, or grading perimeter
swales to collect the lot runoff and directing them into a component of the stormwater collection
system. Lots that will naturally drain into the system are not required to provide these additional
measures.
Article XM
Dispute Resolution and Limitation on Litigation
13.1. Consensus for Association Litigation.
Except as provided in this Section, the Association shall not commence a judicial or
administrative proceeding without the approval of Members representing at least sixty-seven
percent (67%) of the total votes of the Association. This Section shall not apply, however, to (a)
actions by the Association to enforce the Governing Documents (including, without limitation,
the imposition of fines, the suspension of privileges or services or the foreclosure of liens); (b)
the collection of assessments; (c) proceedings involving challenges to ad valorem taxation; or (d)
counterclaims brought by the Association in proceedings instituted against it. This Section shall
not be amended unless such amendment is approved by the percentage of votes, and pursuant to
the same procedures, necessary to institute proceedings as provided above.
Prior to the Association or any Member commencing any judicial or administrative
proceeding to which Declarant is a party and which arises out of an alleged defect in the
Community or any improvement constructed thereon, Declarant shall have the right to meet in
good faith and discuss the subject of the proceeding with the Members or the particular Member,
and to access, inspect, correct the condition of or redesign any portion of the Community,
including any improvement as to which a defect is alleged. In addition, the Association or the
Member shall notify the builder who constructed such improvements prior to retaining any other
expert witness or for other litigation purposes.
13.2 Alternative Method for Resolving Disputes.
Declarant, the Association, its officers, directors and committee members, all persons
subject to this Declaration, any builder within the Community, and any person not otherwise
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subject to the Declaration who agrees to submit to this Article (collectively, "Bound Parties")
agree to encourage the amicable resolution of disputes involving the Community without the
emotional and financial costs of litigation. Accordingly, each Bound Party covenants and agrees
to use good faith efforts to resolve those claims, grievances, or disputes described in Section 13.3
("Claims") using the procedures set forth in Section 13.4 hereof.
13.3. Claims.
Unless specifically exempted below, all Claims arising out of or relating to the
interpretation, application, or enforcement of the Governing Documents, or the rights,
obligations, and duties of any Bound Party under the Governing Documents or relating to the
design or construction of improvements in the Community (other than matters of aesthetic
judgment under Article V, which shall not be subject to review) shall be subject to the
provisions of Section 13.4.
Notwithstanding the above, unless all parties thereto otherwise agree, the following shall
not be Claims and shall not be subject to the provisions of Section 13.4:
a. any suit by the Declarant and/or Association against any Bound Party to
enforce the provisions of this Declaration;
b. any suit by the Declarant, Association or any Owner to obtain a temporary
restraining order (or equivalent emergency equitable relief) and such other ancillary relief as the
court may deem necessary in order to maintain the status quo and preserve the parry's ability to
enforce the provisions of this Declaration;
C. any suit between Owners, which does not include Declarant or the Association
as a party, if such suit asserts a Claim which would constitute a cause of action independent of
the Governing Documents;
d. any suit in which any indispensable party is not a Bound Party; and
e. any suit as to which any applicable statute of limitations would expire within
180 days of giving the Notice required by Section 13.4.1 unless the party or parties against
whom the Claim is made agree to toll the statute of limitations as to such Claim for such period
as may reasonably be necessary to comply with this Article.
With the consent of all parties thereto, any of the above may be submitted to the
alternative dispute resolution procedures set forth in Section 13.4.
13.4. Mandatory Procedures.
13.4.1. Notice. Any Bound Party having a Claim ("Claimant") against any other Bound
Party ("Respondent") (collectively, the "Parties") shall notify each Respondent in writing (the
'Notice"), stating plainly and concisely:
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a. the nature of the Claim, including the persons involved and Respondent's
role in the Claim;
Claim arises);
b. the legal basis of the Claim (i.e., the specific authority out of which the
C. Claimant's proposed remedy; and
d. that Claimant will meet with Respondent to discuss in good faith ways to
resolve the Claim.
13.4.2 Negotiation and Mediation.
a. The Parties shall make every reasonable effort to meet in person and
confer for the purpose of resolving the Claim by good faith negotiation. If requested in writing,
accompanied by a copy of the Notice, the Board may appoint a representative to assist the
Parties in negotiation.
b. If the Parties do not resolve the Claim within Thirty (30) days of the date
of the Notice (or within such other period as may be agreed upon by the Parties) ("Termination
of Negotiations"), Claimant shall have Thirty (30) additional days to submit the Claim to
mediation under an independent agency providing dispute resolution services in New Hanover
County or surrounding areas.
C. If Claimant does not submit the Claim to mediation within such time, or
does not appear for the mediation, Claimant shall be deemed to have waived the Claim, and
Respondent shall be released and discharged from any and all liability to Claimant on account of
such Claim; however, nothing herein shall release or discharge Respondent from any liability to
any person other than the Claimant.
d. Any settlement of the Claim through mediation shall be documented in
writing by the mediator and signed by the Parties. If the Parties do not settle the Claim within
Thirty (30) days after submission of the matter to the mediation, or within such time as
determined by the mediator, the mediator shall issue a notice of termination of the mediation
proceedings ("Termination of Mediation"). The Termination of Mediation notice shall set forth
that the Parties are at an impasse and the date that mediation was terminated.
e. Within five (5) days of the Termination of Mediation, the Claimant shall
make a final written demand ("Settlement Demand") to the Respondent, and the Respondent
shall make a final written settlement offer ("Settlement Offer") to the Claimant. If the Claimant
fails to make a Settlement Demand, Claimants' original Notice shall constitute the Settlement
Demand. If the Respondent fails to make a Settlement Offer, Respondent shall be deemed to
have made a "zero" or "take nothing" Settlement Offer.
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13.4.3 Final and Binding Arbitration.
a. If the Parties do not agree in writing to a settlement of the Claim within
fifteen (15) days of the Termination of Mediation, the Claimant shall have fifteen (15) additional
days to submit the Claim to arbitration in accordance with the rules of arbitration promulgated or
observed by the agency providing the arbitrator. If not timely submitted to arbitration or if the
Claimant fails to appear for the arbitration proceeding, the Claim shall be deemed abandoned,
and Respondent shall be released and discharged from any and all liability to Claimant arising
out of such Claim; however, nothing herein shall release or discharge Respondent from any
liability to parties other than Claimant.
b. This subsection 13.4.3(b) is an agreement to arbitrate and is specifically
enforceable under any applicable arbitration laws of the State of North Carolina. The arbitration
award ("Award") shall be final and binding, and judgment may be entered upon it in any court of
competent jurisdiction to the fullest extent permitted under the laws of North Carolina.
13.5 Allocation of Costs of Resolving Claims.
13.5.1 Subject to Section 13.5.2, each Party shall bear its own costs, including
attorneys' fees, and each Party shall share equally all charges rendered by the mediator(s) and
all filing fees and costs of conducting the arbitration proceeding ("Post Mediation Costs").
13.5.2 Any Award that is equal to or more favorable to Claimant than Claimant's
Settlement Demand shall add Claimant's Post Mediation Costs, including reasonable attorney's
fees, to the Award, such costs to be borne equally by all Respondents. Any Award that is equal
to or less favorable to Claimant than any Respondents' Settlement Offer shall award such
Respondent its Post Mediation Costs, including reasonable attorney's fees.
13.6 Enforcement of Resolution.
If the Parties agree to a resolution of any Claim through negotiation or mediation in
accordance with Section 13.4 and any Party thereafter fails to abide by the terms of such
agreement, or if any Party fails to comply with an Award, then any other Party may file suit or
initiate administrative proceedings to enforce such agreement without the need to again comply
with the procedures set forth in Section 13.4. In such event, the Party taking action to enforce the
agreement shall be entitled to recover from the non -complying Party (or if more than one non-
complying Party, from all such Parties pro rata) all costs incurred in enforcing such agreement,
including, without limitation, attorneys' fees and court costs.
Article XIV
Mortgagee Provisions
The following provisions are for the benefit of holders, insurers, and guarantors of First
Mortgages on Lots in the Community. The provisions of this Article apply to both this
Declaration and to the Bylaws, notwithstanding any other provisions contained therein.
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14.1 Notices of Action.
An institutional holder, insurer, or guarantor of a First Mortgage which provides a
written request to the Association, such request to state the name and address of such holder,
insurer, or guarantor and the street address of the Lot to which its. Mortgage relates, thereby
becoming an ("Eligible Holder"), shall be entitled to timely written notice of:
a. any condemnation loss or any casualty loss which affects a material portion of
the Community or which affects any Lot on which there is a First Mortgage held, insured, or
guaranteed by such Eligible Holder;
b. any delinquency in the payment of assessments or charges owed by a Lot
subject to the Mortgage or such Eligible Holder, where such delinquency has continued for a
period of sixty (60) days, or any other violation of the Governing Documents relating to such
Lot or the Owner or Occupant which is not cured within sixty (60) days of receiving notice of
such violation;
C. any lapse, cancellation or material modification of any insurance policy the
Association maintains; or
d. any proposed action which would require the consent of a specified
percentage of Eligible Holders.
14.2 No Priority.
No provision of this Declaration or the Bylaws gives or shall be construed as giving any
Owner or other party priority over any rights of the First Mortgagee of any Lot in the case of
distribution to such Owner of insurance proceeds or condemnation awards for losses to or a
taking of the Common Areas.
14.3 Notice to Association.
Upon request, each Owner shall be obligated to furnish to the Association the name and
address of the holder of any Mortgage encumbering such Owner's Lot.
14.4 Failure of Mortgagee To Respond.
Any Mortgagee who receives a written request from the Board to respond to or consent
to any action shall be deemed to have approved such action if the Association does not receive a
written response from the Mortgagee within thirty (30) days of the date of the Association's
request, provided such request is delivered to the Mortgagee by certified or registered mail,
return receipt requested.
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14.5 Construction of Article XIV.
Nothing contained in this Article shall be construed to reduce the percentage vote that
must otherwise be obtained under this Declaration, the Bylaws, or the Planned Community Act
for any of the acts set out in this Article.
Article XV
Changes in Common Areas
15.1. Condemnation.
If a Lot or portion thereof shall be taken by eminent domain, compensation and the
Owner's interests in the Common Areas shall be appropriately allocated among all other Owners.
If any part of the Common Areas shall be taken (or conveyed in lieu of and under threat of
condemnation by the Board acting on the written direction of Members representing at least
sixty-seven percent (67%) of the total votes in the Association) by any authority having the
power of condemnation or eminent domain, each Owner shall be entitled to written notice of
such taking or conveyance prior to disbursement of any condemnation award or proceeds from
such conveyance. Such award or proceeds shall be payable to the Association to be disbursed as
follows:
a. If the taking or conveyance involves a portion of the Common Areas on which
improvements have been constructed, the Association shall restore or replace such
improvements on the remaining Common Areas to the extent available, unless within sixty (60)
days after such taking Declarant, during the Declarant Control Period, and Members
representing at least eighty percent (80%) of the total votes in the Association shall otherwise
agree. Any such construction shall be in accordance with plans approved by the Board. The
provisions of Article VIII regarding funds for restoring improvements shall apply.
b. If the taking or conveyance does not involve any improvements on the
Common Areas, if a decision is made not to repair or restore, or if net funds remain after any
such restoration or replacement is complete, then such award or net funds shall be disbursed to
the Association and used for such purposes as the Board shall determine.
15.2. Transfer, Partition, or Encumbrance of Common Areas.
a. Except as this Declaration otherwise specifically provides, the Common Areas
shall not be judicially partitioned or subdivided into Lots, nor shall the ownership of the
Common Areas be otherwise divided or encumbered in any manner after conveyance to the
Association, except upon the approval of Members representing at least eighty percent (80%)
of the total votes in the Association, including a majority of the votes held by Members other
than Declarant, and the consent of Declarant if during the Declarant Control Period.
b. The Association shall have the authority, subject to approval of Members
representing a majority of the total votes in the Association, including a majority of the votes
held by Members other than Declarant, and the consent of Declarant, if during the Declarant
Control Period, to transfer portions of the Common Areas and improvements thereon to
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Book 6540 Page 2912
appropriate governmental entities or tax-exempt organizations for the maintenance, operation,
and preservation thereof; provided, any such transfer shall not relieve such Common Areas from
the rights and benefits of the Association and the Members as provided in this Declaration and
shall otherwise be subject to the provisions of this Declaration.
Article XVI
Fines and Suspension of Privileges or Services
Notwithstanding any other provision herein, the Board may impose fines on an Owner
and/or suspend an Owner's right and privilege to use certain Common Areas for failure of that
Owner, his lessees, agents or invitees, to abide by this Declaration, the Rules and Regulations or
the administrative rules and regulations governing Common Areas. The procedure for the Board
to do so shall be as set forth in the Bylaws. The Board shall not impose any such fine or
suspension unless and until the Owner charged has been given notice of the charge, opportunity
to be heard by and present evidence to the Board and notice of the Board's decision.
Suspensions may be imposed for a reasonable period of time and/or until a violation or
delinquency is cured.
Article XVH
Miscellaneous
17.1 Parties Bound. All persons and entities acquiring any interest in any of the Lots,
including but not limited to lessees, shall be bound by the provisions of this Declaration. All
guests and invitees of such persons and entities, and any other occupants of any of the Lots, shall
likewise be bound.
17.2 Duration. The provisions of this Declaration shall run with and bind the Property
perpetually, unless and until the Community is terminated pursuant to N.C.G.S. Section 47F-2-
118.
17.3 Amendment. Except as provided in Section 11.11 above, this Declaration may be
amended only by a written instrument executed by the Association and authorized by the
affirmative vote of at least sixty-seven percent (67%) of all Lots, cast in person or by proxy at a
meeting held in accordance with the Bylaws of the Association. Any amendment must be
recorded to be effective. Notwithstanding anything contained herein to the contrary, any
amendment serving to revise Section 7.2.4 herein shall not be valid unless reviewed and
approved in writing by the governmental entity having jurisdiction over the Stormwater Control
Facilities.
17.4 Enforcement. Subject to the provisions of Article XIII above, the Declarant, any
Owner and/or the Association shall have the right to enforce, by any proceeding at law or in
equity, all restrictions, conditions, covenants and obligations imposed by this Declaration.
Subject to the provisions of Article XIII above, the Declarant, the Association or any Lot owner
may bring any action necessary to enjoin any violation or breach of the provisions of this
Declaration. The Declarant, the Association and/or any Owner shall be entitled to recover
49
Book 6540 Page 2913
reasonable attorney's fees incurred in bringing and prosecuting such action from the breaching or
violating Owner(s).
17.5 Failure to Enforce Not a Waiver. The failure to enforce any right, reservation,
covenant or restriction contained in this Declaration, however long continued, shall not be
deemed a waiver of the right to do so thereafter.
17.6 Assignment by Declarant. Any or all of the rights, powers, easements, functions and
obligations reserved or given to the Declarant in this Declaration may be assigned to the
Association, and the Association shall accept and assume responsibility for any or all such rights,
powers, easements, functions and obligations when requested by the Declarant. Any such
assignments or transfer shall be made by a Recorded Document, executed by both the Declarant
and the Association, and the Association shall thereupon have the same rights and powers and be
subject to the same obligations and duties as are herein given to and assumed by the Declarant.
The Declarant, but not the Association, shall thereupon be released from such obligations and
duties.
17.7 Notice of Sale, Lease or Acquisition. In the event an Owner sells or leases such
Owner's Lot, the Owner shall give to the Association, in writing, prior to the effective date of
such sales or lease, the name of the purchaser or lessee of the Lot and such other information as
the Association may reasonably require. Upon acquisition of a Lot, each new Owner shall give
the Association, in writing, the name and mailing address of the Owner and such other
information as the board may reasonably require.
17.8 Variances. Notwithstanding anything to the contrary contained herein, the Declarant
and/or the Association or its designee shall be authorized to grant individual variances from any
of the provisions of this Declaration, the Bylaws and any rule, regulation or use restriction
promulgated pursuant thereto if the Declarant or the Association determine that waiver of
application or enforcement of the provision in a particular case would not be inconsistent with
the overall scheme of development for the Community.
17.9 Severability. Invalidation of any one of these covenants or restrictions by judgment
or court order shall not affect any of the other provisions of this Declaration, which shall remain
in full force and effect.
17.10 Captions. The captions herein are inserted only as a matter of convenience and for
reference, and shall not be construed to define, limit or describe the scope of any provision of this
Declaration.
17.11 Law Controlling. This Declaration shall be construed and governed pursuant to the
laws of North Carolina.
17.12 References to Statutes. All references herein to any statutory provision shall be
construed to include and apply to any subsequent amendments to or replacements of such
provision.
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Book 6540 Page 2914
17.13 Assessments for Public Improvements/Ad Valorum Taxes. Pursuant to Article IX
above, the Association is authorized to levy Base Assessments against Owners for the payment
of any assessments for public improvements or taxes that may be assessed against the
Association or the Common Areas. In the event that the Association defaults in the payment to
the jurisdiction entitled thereto of any assessments for public improvements or ad valorem taxes
levied against the Common Areas, and in the event that said default shall continue for a period of
six (6) months, each Owner shall become personally obliged to pay to the jurisdiction a pro -rated
portion of the taxes or assessments in an amount determined by dividing the total taxes and/or
assessments due to the jurisdiction by the total number of Lots in the Association. If the sum is
not paid by the Owner within thirty (30) days following receipt of notice of the amount due, the
sum shall become a continuing lien on the property of the Owner, his heirs, devisees, personal
representatives, and assigns. The taxing or assessing jurisdiction may either bring an action at
law against the Owner personally obliged to pay the same, or may elect to foreclose the lien
against the property of the Owner.
[The Remainder of this Page Intentionally Left Blank.]
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Book 6540 Page 2915
IN WITNESS WHEREOF, D.R. Horton, Inc. as the Declarant hereunder, has caused this
instrument to be executed as of the day and year first above written.
D.R. HORTON, INC.
a Delaware corporation, Declarant
LOU
Name: �.� L---x l(,-'
T 7a
Its: V 4���?nn
STATE OF AL R ,,,4 C_M 0 L I 0A.
COUNTY OF ,i_1 AA" If i2
I, _ - ✓ , a Notary Public of the County and State aforesaid,
certify that 4 ersonally appeared before me this day and
acknowledged that s/he is Dw I s i o,� P�Z s i A r f of D.R. Horton, Inc., a Delaware
corporation, and that s/he, being duly authorized to do so, executed the foregoing for and on
behalf of said corporation.
Witness my hand and official stamp or seal, this oV A)D day of f 20'(LIA tl- ( , 2022
ignature of NoPublic`
My Commission Expires: S ' 1 acaS
52
Book 6540 Page 2916
EXHIBIT A
Land Initially Submitted
All that certain tract or parcel of land lying and being situate in Cape Fear Township, New
Hanover County, North Carolina, and being more particularly described as follows:
Being all of Tract 1 (197.35 ac.) as shown on a map entitled "Minor Subdivision Plat 312.85
Acres for Sidbury Station" recorded in Map Book 69, Pages 153-154 in the office of the Register
of Deeds of New Hanover County.
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Book 6540 Page 2917
EXHIBIT B
Land Subiect to Annexation in Future
Any land within one mile of the Property described in Exhibit A of this Declaration.
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Book 6540 Page 2918
EXHIBIT C
Initial Rules and Regulations
The following restrictions shall apply to all of the Community until such time as they are
amended, modified, repealed, or limited pursuant to Article IV of the Declaration:
1. General. The Community shall be used only for residential, recreational, and related
purposes (which may include, without limitation, an information center and/or a sales office for
Declarant to assist in the sale of any property or portion thereof as described in Exhibit A or B,
offices for any property manager retained by the Association, and business offices for Declarant
or the Association) consistent with this Declaration and any Supplemental Declaration.
2. Restricted Activities. The following activities are prohibited within the Community
unless expressly authorized by, and then subject to such conditions as the Board may impose:
(a) Parking any vehicles on streets or thoroughfares within the Community or parking
of commercial vehicles or equipment, mobile homes, recreational vehicles, trailers, stored.
vehicles, or inoperable vehicles in places other than enclosed garages; however, construction,
service, and delivery vehicles shall be exempt from this provision during daylight hours for such
period of time as is reasonably necessary to provide service or to make a delivery to a Lot or the
Common Areas. For the purposes of these Rules and Regulations, a "commercial vehicle" shall
mean any vehicle with ladders, work equipment, or related storage on the exterior of the vehicle,
or a vehicle greater than 3/4 of a ton;
(b) Raising, breeding or keeping animals, livestock or poultry of any kind, except that
a reasonable number of dogs, cats or other usual and common household pets may be permitted
on a Lot. Any animal which, makes objectionable noise or, in the Board's judgment, constitutes
a nuisance or inconvenience to the Occupants of other Lots, shall be removed by the owner upon
the Board's request. If the pet owner fails to honor such request, the Board may remove the pet.
Dogs shall be kept on a leash or otherwise confined in a manner acceptable to the Board
whenever outside the dwelling. Owners shall clean up behind any pet while walking such pet on
any Common Property. Pets shall be registered, licensed, and inoculated as required by any
applicable state, municipal or local law, ordinance, rule or regulation;
(c) Any activity that emits foul or obnoxious odors outside the Lot or creates noise or
other conditions, which tend to disturb the peace or threaten the safety of the Occupants of other
Lots;
(d) Any activity that violates local, state, or federal laws or regulations; provided, the
Board shall have no obligation to take enforcement action in the event of a violation;
(e) Pursuit of hobbies or other activities which tend to cause an unclean, unhealthy, or
untidy condition to exist outside of enclosed structures on the Lot;
(f) Any noxious or offensive activity (including, without limitation, barking dogs)
which in the reasonable determination of the Board tends to cause embarrassment, discomfort,
annoyance, or nuisance to persons using the Common Areas or to the Occupants of other Lots;
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Book 6540 Page 2919
(g) Outside burning of trash, leaves, debris, or other materials, except during the
normal course of constructing a dwelling on a Lot;
(h) Use or discharge of any radio, loudspeaker, horn, whistle, bell, or other sound
device so as to be audible to Occupants of other Lots, except alarm devices used exclusively for
security purposes;
(i) Use and discharge of firecrackers and other fireworks;
0) Dumping grass clippings, leaves, or other debris, petroleum products, fertilizers,
or other potentially hazardous or toxic substances in any drainage ditch, stream, pond, or lake, or
elsewhere within the Community, except that fertilizers may be applied to landscaping on Lots
provided care is taken to minimize runoff, and Declarant and builders may dump and bury rocks
and trees removed from a building site on such building site;
(k) Accumulation of rubbish, trash, or garbage except between regular garbage pick
ups, and then only in approved containers. Such containers shall be either screened from view or
kept inside, except as reasonably necessary for garbage pick ups;
(1) Obstruction or rechanneling drainage flows after location and installation of
drainage swales, storm sewers, or storm drains, except that Declarant and the Association shall
have such right; provided, the exercise of such right shall not materially diminish the value of or
unreasonably interfere with the use of any Lot without the Owner's consent;
(m) Subdivision of a Lot into two or more Lots, or changing the boundary lines of any
Lot after a subdivision plat including such Lot has been approved and recorded, except that
Declarant shall be permitted to subdivide or replat Lots it owns;
(n) Swimming, boating, use of personal flotation devices, or other active use of lakes,
ponds, streams, or other bodies of water within the Community. The Association shall not be
responsible for any loss, damage, or injury to any person or property arising out of the authorized
or unauthorized use of lakes, ponds, streams, or other bodies of water within or adjacent to the
Community;
(o) Use of any Lot for operation of a timesharing, fraction -sharing, or similar program
whereby the right to exclusive use of the Lot rotates among participants in the program on a fixed
or floating time schedule over a period of years, except that Declarant and its assigns may operate
such a program;
(p) Discharge of firearms; provided, the Board shall have no obligation to take action
to prevent or stop such discharge;
(q) On -site storage of gasoline, heating, or other fuels, except that a reasonable
amount of fuel may be stored on each Lot for emergency purposes and operation of lawn
mowers, gas grills, and similar tools or equipment, and the Association shall be permitted to
store fuel for operation of maintenance vehicles, generators, and similar equipment;
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Book 6540 Page 2920
(r) Any business, trade, or similar activity, except that an Owner or Occupant
residing in a Lot may conduct business activities within the Lot so long as: (i) the existence or
operation of the business activity is not apparent or detectable by sight, sound, or smell from
outside the Lot; (ii) the business activity conforms to all zoning requirements for the Community;
(iii) the business activity does not involve door-to-door solicitation of residents of the
Community; (iv) the business activity does not, in the Board's judgment, generate a level of
vehicular or pedestrian traffic or a number of vehicles being parked within the Community which
is noticeably greater than that which is typical of Lots in which no business activity is being
conducted; and (v) the business activity is consistent with the residential character of the
Community and does not constitute a nuisance, or a hazardous or offensive use, or threaten the
security or safety of other residents within the Community, as may be determined in the Board's
sole discretion.
The terms "business" and "trade," as used in this provision, shall be construed to have
their ordinary, generally accepted meanings and shall include, without limitation, any occupation,
work, or activity undertaken on an ongoing basis which involves the provision of goods or
services to persons other than the provider's family and for which the provider receives a fee,
compensation, or other form of consideration, regardless of whether: (i) such activity is engaged
in full or part-time, (ii) such activity is intended to or does generate a profit, or (iii) a license is
required.
Leasing of a Lot shall not be considered a business or trade within the meaning of this
subsection. This subsection shall not apply to any activity conducted by Declarant or a builder
approved by Declarant with respect to its development and sale of the Community or its use of
any Lots which it owns within the Community;
(s) Capturing, trapping, or killing of wildlife within the Community, except in
circumstances posing an imminent threat to the safety of persons using the Community;
(t) Any activities which materially disturb or destroy the vegetation, wildlife,
wetlands, or air quality within the Community;
(u) Conversion of any carport or garage to finished space for use as an apartment or
other integral part of the living area on any Lot without prior approval pursuant to Article V;
(v) Operation of motorized vehicles on pathways or trails maintained by the
Association;
(w)Any construction, erection, placement, or modification of any thing, permanently
or temporarily, on the outside portions of the Lot, whether such portion is improved or
unimproved, except in strict compliance with the provisions of Article V of the Declaration. This
shall include, without limitation, landscaped or grassed areas; signs; basketball hoops, swing sets,
and similar sports and play equipment; clotheslines; garbage cans; woodpiles; and hedges, walls,
dog runs, animal pens, or fences of any kind. Under no circumstances shall the ARC approve the
replacement of all or a majority of the grassed area of a Lot with mulch or stone;
(x) Hanging of sheets, towels, clothes or laundry in windows or anywhere on a Lot so
as to be visible from any roadway or any other Lot.
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Book 6540 Page 2921
3. Prohibited Conditions. The following shall be prohibited within the Community:
(a) Plants, animals, devices, or other things of any sort whose activities or existence
in any way is noxious, dangerous, unsightly, unpleasant, or of a nature as may diminish or
destroy the enjoyment of the Community;
(b) Structures, equipment, or other items on the exterior portions of a Lot which have
become rusty, dilapidated, or otherwise fallen into disrepair;
(c) Installation of any sprinkler or irrigation systems or wells of any type, other than
those initially installed by Declarant or a Declarant approved builder, which draw upon water
from lakes, creeks, streams, rivers, ponds, wetlands, canals, or other ground or surface waters
within the Community, except that Declarant and the Association shall have the right to draw
water from such sources;
(d) Satellite dishes, antennas, and similar devices for the transmission of television,
radio, satellite, or other signals of any kind, except that Declarant and the Association shall have
the right, without obligation, to erect or install and maintain any such apparatus for the benefit of
all or a portion of the Community; and (i) satellite dishes designed to receive direct broadcast
satellite service which are one meter or less in diameter; (ii) satellite dishes designed to receive
video programming services via multi point distribution services which are one meter or less in
diameter or diagonal measurement; or (iii) antennas designed to receive television broadcast
signals ((i), (ii), and (iii), collectively, "Permitted Devices") shall be permitted; however, any
such Permitted Device must be placed in the least conspicuous location on the Lot (generally
being the rear yard) at which an acceptable quality signal can be received and is not visible from
the street, Common Areas, or neighboring property or is screened from the view of adjacent Lots
in a manner consistent with the Community -Wide Standard and the Architectural Guidelines; and
(e) Installation of exterior decorative items, including but not limited to statuary,
fountains or wishing balls, but not including flags, political signs, and/or permitted exterior
decorative lights.
4. Leasing of Lots. "Leasing," for purposes of this Paragraph, is defined as regular,
exclusive occupancy of a Lot by any person, other than the Owner for which the Owner receives
any consideration or benefit, including, but not limited to, a fee, service, gratuity, or emolument.
All leases shall be in writing. The Board may require a minimum lease term; however, in no case
shall such term be shorter than six (6) months. No owner shall lease any Lot without first
providing all lessees with copies of the Governing Documents. Each lease shall require all
lessees to acknowledge receipt of copies of all of the Governing Documents and to comply with
and adhere to all of the Governing Documents. A true copy of each executed lease, together with
such additional information as may be required by the Board, shall be given to the Board by the
Lot Owner within ten (10) days of execution of the lease. This Section 4 shall not apply with
respect to any Lot subject to a mortgage which is insured or guaranteed by the Federal Housing
Administration or the Veterans Administration, or where the provisions of this Section 4 are
otherwise prohibited by law.
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Book 6540 Page 2922
TAMMY THEUSCH New Hanover County
PIVER
Register of Deeds Register of Deeds
320 CHESTNUT ST SUITE 102 - WILMINGTON, NORTH CAROLINA 28401
Telephone 910-798-4530 - Fax 910-798-7716
4'-L.— tl 'a., I.
State of North Carolina, County of NEW HANOVER
Filed For Registration: 02/22/2022 02:21:28 PM
Book: RB 6540 Page: 2864-2922
59 PGS $198.00
Real Property $198.00
Recorder: STEPHANIE PEREZ
Document No: 2022006883
DO NOT REMOVE!
This certification sheet is a vital part of your recorded document. Please retain with original document and submit
when re-recording.