The Summit at Lake Norman Home Owners Associations Structure 2012

Structure Management Company Board of Directors Committees

Property Management Company Any Management Company – Budget Works w/ the treasurer Submits annual budget to secretary for Approval & posting – Maintains Financial records Makes collections per established guidelines Makes payments per established guidelines – Makes recommendations to BoD on state statues concerning HOAs, if new or when requested

Board of Directors (BoD) President Vice President Treasurer Secretary

Board Members Responsibilities Enforce the documents Establish sound fiscal policies and maintain accurate records Develop a workable budget, keeping in mind the needs, requirements and expectations of the community Establish reserve funds Act on budget items and determine assessment rates Collect assessments Establish, publicize, and enforce rules and penalties Authorize legal action against owners who do not comply with the rules

Board Member Responsibilities (cont’d) Review local laws before passing rules or sending bylaws to membership for approval Appoint committees and delegate authority to them Select an attorney, an auditor, insurance agent and other professionals for the association Provide adequate insurance coverage, as required by the bylaws and local governmental agencies Inform board members of all business items that require their vote Inform members of important board decisions and transactions See that the association is protected for the acts of all parties with fiscal responsibilities Attend and participate at meetings

BoD Responsibilities (Cont’d) "Fiduciary duty" is used often in describing the responsibilities for actions of board members. The term basically means that the board has responsibility for managing someone's money or assets. It relates to protecting those assets and imparts a special responsibility upon the person who is the "fiduciary." The term is generally used in a legal context and any board member and the entire board can be sued for what is commonly called "breach of fiduciary duty," which typically means failure in their responsibility for properly managing the association's assets.

President The president of an association is vested with all the powers generally given to the chief executive officer of a corporation. While specific by-law provisions may vary the president's duties, it is generally presumed that he or she will preside at all meetings of the board and the membership. The president will execute contracts, orders and other documents in the name of the association as its agent. When signing documents, the president should indicate the capacity in which he or she is signing in order to avoid any personal liability since the president's signature, under most circumstances, will bind the association under a doctrine of inherent powers. The president also assumes general charge of the day-to-day administration of the association and has the authority to order specific actions in furtherance of the board's policies. The president serves as spokesman for the board of directors in most matters relating to general association business. Like all officers of the association, the president has an affirmative duty to carry out the responsibilities of the office in the best interests of the association. Unless otherwise specified in governing documents, the president serves at the will of the board of directors and can be removed with or without cause at any time by a majority of the full board

Vice President Is vested with all the powers which are required to perform the duties of the association president in the absence of the president. The vice president does not automatically possess inherent powers to act in the capacity of the chief executive officer, and may act for the president only when the president is actually absent or otherwise unable to act. The vice- president may assume such additional duties as are defined by the board of directors. Often, the vice- president will chair one or more substantive committees like that of architectural review.

Treasurer Annual Budget – Receive input from all the different committees. – consideration contractual obligations of the HOA – Prepare w/ Property Mgt. firm. – Obtain BoD approval Review each month's financial statements and advise the Property Manager for errors or problems noted. Establish & ensure that the Board's collection policy is properly implemented. Prepare Request For Informational quotes for expenditures equal to or greater than $3,000 from any committee request. Institute a semiannual audit program of the Associations financial records and advise the Board of any problems noted in the audit, including corrective actions that should be taken. Maintain oversight of the Association's Reserve funds to ensure that they are properly maintained and allocated and that necessary changes are recommended.

Treasurer (Cont’d) The treasurer is the custodian of the funds, securities and financial records of the association. When the association has a manager or management company that actually handles the funds on a daily basis, the treasurer's duties will include overseeing the appropriate people to insure that the financial records and reports are properly kept and maintained. Unless the by-laws otherwise specify, the treasurer is responsible for coordinating the development of the proposed annual budget and for preparing and giving the annual financial report on the financial status of the association. The treasurer does not have the authority to bind the association or the board of directors in dealings with third parties unless the board has provided express authority for the treasurer to do so. As with the association's secretary, the treasurer does not have to perform the day-to-day record keeping functions of the association when this responsibility is transferred to a management company, but the treasurer will ultimately be responsible for insuring that the financial records of the association have been maintained properly in accordance with sound accounting practices.

Secretary The secretary of the association is responsible for keeping and maintaining a record of all meetings of the board and the membership and is the custodian for most of the official records of the association. The position of secretary is not simply a clerical position. In many cases, the secretary will not actually keep the minutes of the meetings, but will be responsible for obtaining someone who will do so as a recorder or assistant secretary. As the custodian for the minutes and other official records of the association, the secretary is responsible for insuring access to those records by the members of the association and their authorized representatives.

Secretary (Cont’d) Maintains HOA website, if applicable Posts (w/in website) BoD’s minutes of meetings Posts (W/in website) documents of interest to HOA members – Monthly news letters, – Governance laws – Architectural Stds. – Meeting minutes of various committees Generate template forms – Meeting minutes – Request for informational requests – News letters – As required

Committees (Appointed by the BoD) Architectural/Landscaping/Maintenance (ALM) – Duties are very limited in nature Communications …. N/A at this time Property Protection …. N/A at this time Communities Activities …. N/A at this time

ALM Committee Appointed by & reports to the BoD Conducts monthly meetings & takes mtg. Minutes …. When necessary Delivers to the Secretary minutes of meetings for posting to the HOA website … When necessary Submits input to treasurer on annual budget requirements Makes recommendations to BoD – Proposal – Estimated Cost created for the purpose of establishing and enforcing criteria for the construction of Improvements within the Property Essentially, it authorizes the ALM to control all exterior modifications to homes and to grant variances on a case-by-case basis. Promulgate standards and establish procedures by which homeowners can have their proposals considered Report to the BoD with recommendations for their consideration & decision.

ALM Committee (cont’d) The ALM Committee shall have responsibility for oversight of the maintenance & improvement of all common areas owned &/or maintained by the HOA,shall advise the Board on matters relating to the HOA's responsibility for arranging landscape maintenance services for those neighborhoods where such service is provided by the HOA. Specifically, the Committee shall: Working with the Property Manager, recommend the selection and participate in the oversight of a contractor to maintain all of the HOA's landscaped areas; Maintain oversight of the condition and maintenance of other HOA property, including but not limited to signs, lights, monuments and other equipment;, Working with the Property Manager, advise the treasurer &/or Finance Committee & Board of financial needs to properly maintain HOA property. Maintain oversight of the cost and quality of service being rendered by the contractor selected to maintain the "mandatory maintenance" communities and make appropriate recommendations to the Board.

Communications (Currently N/A at this time) Appointed by & Reports to the Board of Directors Conducts monthly meetings & takes mtg. minutes Delivers to the Secretary minutes of meetings for posting to the HOA website Shall enhance communication with & among residents/members of the Association. Submits input to treasurer on annual budget Makes recommendations to BoD – Proposal – Estimated Cost Responsible for: – Publishing Happenings, – Operating the HOA website, – Publishing the Neighborhood Directory, – Sponsoring a Welcome Committee – Maintaining the Coming Events sign. – Other functions ….. assigned from time to time.

Property Protection (Currently N/A at this time) Appointed by & reports to the BoD in an advisory & informational capacity. Suggest enhancements to the Neighborhood Watch Program. Conducts monthly meetings & takes mtg. minutes Delivers to the Secretary minutes of meetings for posting to the HOA website Submits input to treasurer on annual budget If applicable, makes recommendations on security & safety – Proposal – Estimated cost

Community Activities (Currently N/A at this time) Appointed by & Reports to the Board of Directors Conducts monthly meetings & takes mtg. minutes Suggesting activities that tend to enhance the quality of life in the community and outside community. Submits input to treasurer on annual budget Sponsor the following: – The community newsletter, – Community directory, – Welcoming committee, – Activities that help the outside community blood drives Clothing drives Food drives etc.