SW8070336_Historical File_20070905

N C D E N R State Storm
Water Management Plan
THE GARDENS
March 20, 2007
CLIENT: H&S DEVELOPMENT OF WILMINGTON, LLC
419 MARINA STREET
CAROLINA PEACH, NC 28428
STROUD ENGINEERING, P.A.
102 D CINEMA DRIVE
WILMINGTON, N.C. 28403
[phone]
File f:lmasterlpw-7091wpd\ststormcov.wpd

State Stormwater Management Project Narrative
The Gardens
PW 709
12/28/2006
Project Summa
The purpose of this project is to construct a multi family residential development on
approximately 12 acres of land located approximately 1.6 miles north of Monkey Junction, on the
historical driving range property. One hundred and twenty two condominium units are planned in
this development.
Site Description
The topography of the site Is flat throughout. Slopes generally range from 00/o to 5%. No
wetlands exist on the site.
Adioinina Prooe
Adjoining property is primarily residential (R-15 and R-10). The site is bordered to the
East by South College Road.
Soils
Solis in the project area are mapped in the New Hanover County Soil Survey as primarily
Leon Sand and Lynn Haven Fine Sand. Both are characterized as poorly drained soils.
Planned Storrq Water Manaaement Practices
The flat topography of this site does not lend itself to high flow velocities. The site will be
graded to insure storm water will be collected by a network of pipes, drop inlets and catch basins
for delivery to the two project detention ponds. Each pipe discharge will be provided flared end
sections to reduce pipe discharge velocities and induce sheet flow downstream.
The detention system has been designed with a contingency for additional impervious
surface that may be desired for future amenity in the common areas. This Impervious is not
presently shown on the plan. Any proposal of future impervious will have to be submitted and
approved by NCDENR prior to construction of these facilities.
Storm water management, In accordance with the NCDENR Coastal Storm Water
regulations, will be achieved through a wet detention pond. There are two ponds proposed by the
development. The smaller pond is designed to completely contain the state's required volume of
one inch per the reported impervious area. Storm stages above the state's required storage will
overflow into a larger pond to enable detention In accordance with the New Hanover County
Storm Water, as well as the City of Wilmington, detention requirements and limit discharge rates
to less than the design storms calculated pre development run off rates. An outlet structure will
be provided in the smaller pond to detain the first inch of runoff for a minimum period of two days.
The structure will have a wier located at the peak elevation of the state's required storage
volume. The Wier will limit the discharge rates per the required storm requirements. The
calculated one hundred year storm runoff will induce a sheet overflow through a lined trapezoidal
channel. Detention pond outfall will be to an existing ditch immediately adjacent the smaller
pond. The recipient stream is given to be Mott's Creek tributary to the Cape Fear River.

THE GARDENS
NCDENR Stormwater Management Calculations
Job#: PW645
Engineer. JHF
Date: 4119=7
Drainage Area: 12 ac
Impervious Area: I 4. w
% Impervious: 40. %
Pervious Area: 7. ac
% Pervious= 60, %
Impervious Breakdown: State Required Surface Area Calculation
Buildings 81,684 SF
Parking 83,059 SF Desired TSS Removal Capacity= go
Walks 15,330 SF Depth Below Perm. Pool=
Subtotals, 180,073 SF SAIDA=
Contingency 20,015 SF
Total 209,088 SF Required Surface Area (SF)c
4.8 AC.
State Stormwater Runoff Volumetric Calculations:
Runoff to be Treated- in
Runoff* I u,41 In
Pond 1 Treatment Volume= r"--T=cf
Wet Detention Pond Volumetric Information
P AW6%0 P&rMAn t Pr [
Note: Runoff calculated by following expresslon:
Note: Treatment Volume calculated via following expression:
V=1.0"Area Runoff 43560112
El.
$A Forebay
Inc. Vol.
Forelbey
Total
Forebay
SA Pond
Inc. Vol.
Pond
Total Vol
Pond
20
Wl
21
1121
560.5
5W.5
7598
SM
8965
22
1718
1419
1980
am
8269
15233
23
2382
2050.
A=
1
9842
44875
24
3111
27416.
6776.5
11815
11030
35955
24.5
35W
675
1
12647
116
42071
Otal=
8452
Tout
42071
% Fore
Ahre Pphe Rant Pe [
EL.
SA Pond
Inc. Vol.
Pond
Total Vol.
Pond
4.5
law
25
1
8572
25.5
19858
1
26
21668
28430
1TO—WI=1
28430
24 Day Drawdown for State Volume
Required Storage=
of
Day Flow
�efs
$ Day Flow-
-r----MRcfs
2 Day Diameter--
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3 Day Diatriew-
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Drawdown
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e
Drawdown Times
Tim
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North Carolina Secretary of State
Page 1 of 1
Forth Carolina
Elaine F Marshall D P RT ENT OF THE
Secretary SECRETARY OF STATE
CORPORATIONS
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Date: 4/19/2007
Click here to:
View Document Filings I
To- Print apre-populated Annual Report Form I Annual Report Ci
Report I
Corporation Names
Name Name Type
NC H & S Development of Legal
Wilmington LLC
Limited Liability Company Information
SOSI D:
0713584
Status:
Current -Active
Date Formed:
2/26/2004
Citizenship:
Domestic
NC
Duration:
Perpetual
Registered Agent
Agent Name: dbrrSimpson, Elizabeth
Registered Office Address: 419 Marina Street
Carolina Beach NC 28426
Registered Mailing Address: 419 Marina Street
Carolina Beach NC 28426
Principal Office Address:
Principal Mailing Address:
419 Marina Street
Carolina Beach NC 28426
419 Marina Street
Carolina Beach NC 28426
For questions or comments about the Secretary of State's web site, please send e-mail to Webmaster.
http://www.secretary.state.nc.us/corporations/Corp.aspx?PitemId=6198686 4/19/2007

E-Filed Annual Report -1-0-6198686
LIMITED LIABILITY COMPANY For year 2007
�:, .:_ • Do not data enter manually.
k
ANNUAL REPORT
NAME OF LIMITED LIABILITY COMPANY: H & SDevelopment of Wilmington LLC
STATE OF INCORPORATION: NC
SECRETARY OF STATE R.L.L.P. ID NUMBER: 0713584
NATURE OF BUSINESS: real estate development
REGISTERED AGENT: Simpson, Elizabeth
REGISTERED OFFICE MAILING ADDRESS: 419Marina Street
Carolina Beach, NC 28428
REGISTERED OFFICE STREET ADDRESS: 419 Marina Street
Carolina Beach, NC 28428 New Hanover County
PRINCIPAL OFFICE TELEPHONE NUMBER: 910-443-2976
PRINCIPAL OFFICE MAILING ADDRESS
PRINCIPAL OFFICE STREET ADDRESS
IvIANAGERS/*N EMBERS/ORGANIZERS:
419 Marina Street
Carolina Beach, NC 28428
419 Marina Street
Carolina Beach, NC 28428
Name: John K Hutchings Name: Elizabeth A Simpson
Title: Manager Title: Manager
Address: Address:
5600 Carolina Beach Rd 419 Marina Street
Wilmington NC 28412 Carolina Beach NC 28428
CERTIFICATION OF ANNUAL REPORT MUST BE COMPLETED BY ALL LIMITED LIABILITY COMPANIES
John Hutchings
FORM MUST BE SIGNED BY A MANAGER/MEMBER
John Hutchings
04/19/2007
DATE
Manager
TYPE OR PRINT NAME TYPE OR PRINT TITLE
ANNUAL REPORT FEE: $200 MAIL TO: Secretary of State • Corporations Division • Post Office Box 29525 • Raleigh, NC 27626-0525

. GY R c+oG
Beth .EasIey Wetheril
Soil Eraslou Spci 6 B.S.C.
MEAIORAND
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230 ATarket Placebeparttraezat
'ilmfu tou; Dive -Suite 160
i; Worth ..aroixna 28403. �p Q i'ElEP�I`011'E 9.�0-79,9 713.9 IY�
• �Q U�'v l 4 �,l�e
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Sail �� herd � `f• � • a � 1
rosiOn S,pecla .list
. Secihneritatxon and Erosion control • Grading perM,t-#
The attached flans ,have been submitted for approval fo-New HanOVer C If you haounty.
ve any questions; please contact
this office.
BEW/aj
Attaclunent

H & S DEVELOPMENT OF WILMINGTON LLC, LLC Agreement
OPERATING AGREEMENT, made and entered into as of March 12, 2004, by and between
those persons who have executed this Operating Agreement or a counterpart hereof.
The parties hereto, intending to be legally bound, agree as follows:
ARTICLE I
Organization
.01 FORMATION OF LIMITED LIABILITY COMPANY
On February 26 2004, John K Hutchings, organized a North Carolina limited liability company
(the "Company") pursuant to the Act, as hereinafter defined The Articles of Organization as filed
by John K Hutchings, Vanda M Hutchings, Mark R Simpson & Elizabeth A Simpson are hereby
adopted and ratified by the Members In the event of a conflict between the terms of this
Operating Agreement and the terms of the Articles of Organization. the terms of the Articles of
Organization shall prevail
.02 NAME
The business of the Company shall he conducted under the name H & S Development of
Wilmington L.L.C. or such other name as the Manager(s) may designate in writing to the
Members
.03 PRINCIPAL OFFICE. REGISTERED OFFICE AND REGISTERED AGENT
The principal business office of the Company shall be located at 5600 Carolina Beach Rd,
Wilmington, NC 28412 the Company's registered office shall be located at 5600 Carolina Beach
Rd, "Wilmington, NC 28412 and its initial registered agent shall be Elizabeth Simpson. The
Manager(s) may within their sole and unrestricted discretion, change the principal office,
registered office or registered agent of the Company. in such event, shall give written notice
thereof to all Members. and the Manager(s) may establish additional offices of the Company
.04 PURPOSE
The purpose of the Company is to jointly own and construct an 18 unit apartment building on
the undeveloped parcel located on Dunhill Lane, Wilmington, NC acquired from Palm Beach
Development Group LLC and to pursue other business and investment opportunities as the
Manager(s) shall determine may be beneficial for the Company.
.05 FISCAL YEARS
The fiscal year of the Company shall be the calendar year or such other fiscal year as the
Manager(s) shall determine pursuant to the provisions of Code Sec. 706(b).

.06 TERM
The term of the Company commenced on the date of filing of the Articles of Organization and
shall terminate in accordance with Section 10.01.
ARTICLE II
General Definitions
As used in this Agreement, the following terms shall each have the meaning set forth in
this Article (unless the context otherwise requires). For purposes of this Agreement, the
term "person" shall include individuals, corporations, associations, partnerships, limited
liability companies, trusts, estates and other entities.
.01 ACT
Act shall mean the North Carolina Limited Liability Company Act as now in effect or as
hereafter amended or revised.
02 AFFILIATE OF A MEMBER
Affiliate of a Member shall mean any person directly or indirectly controlling, controlled by or
under common control with a Member or Members.
,03 AGREEMENT
Agreement shall mean this Operating Agreement, and the same may be amended or
supplemented from time to time in accordance with the provisions hereof.
.04 BANKRUPT
Bankrupt shall mean, with respect to any Member, the occurrence of any one or more of the
following: (i) the malting by the Member of an assignment for the benefit of creditors; (ii) the
filling of an involuntary petition seeking an adjudication of bankruptcy under Chapter 7 of the
Bankruptcy Code, which filing is not dismissed within sixty (60) days of the filing; (iii) the filing
of a voluntary petition by the Member under Chapter 7 of the Bankruptcy Code; (iv) the filing of
a voluntary or involuntary petition under Chapters 11 or 13 of the Bankruptcy Code which is not
dismissed within sixty (60) days of the filing, but only if the Member is not the debtor -in -
possession of his assets; (v) the entry of an order, judgment or decree by a court of competent
jurisdiction providing for the liquidation of the assets of the Member or appointing a receiver,
trustee or other administrator of the Member's assets which continues in effect and unstayed for a
period of sixty (60) days; (:n) the confirmation of any plan of reorganization under either Chapter
11 01 13 of the Bankruptcy Code providing for the liquidation of substantially. all of the
Member's assets. For purposes of (iv) above, a Member shall not be considered a debtor -in -
possession of his assets if a trustee, receiver or other person or entity is appointed to, or in fact
does, control or operate the assets of the Member .

.05 BANKRMCY CORE
Bankruptcy Code shall mean Title 11 of the United States Code, as now in effect or as hereafter
amended.
.06 CASH FLOW
Cash Flow shall mean all cash received by the Company from all sources (including capital
contributions and borrowings), less cash expended or reserved in the discretion of the Manager(s)
for liabilities (contingent or otherwise), expenses, capital expenditures and obligations of the
Company or obligations secured by the assets of the Company.
.07 CODE
Code shall mean the Internal Revenue Code of 1986, as now in effect or as hereafter amended.
.08 COMPANY
Company shall mean H & S Development of Wilmington L.L.C. , the limited liability company
formed by the filing of the Articles of Organization, as constituted from time to time.
.09 MANAGERS
Managers shall mean John K Hutchings and any successor or additional Manager elected in
accordance with Article VII, in such person's capacity as a Manager.
.10 MEMBERS
Members shall mean the persons set forth on Schedule A attached hereto, and any person
admitted as an additional or substitute Member in accordance with Article VIII, in such person's
capacity as a Member.

.11 MEMBERSHIP INTEREST
Membership Interest shall mean, with respect to a Member, the percentage of ownership interest
in the Company of such Member, as set forth on Schedule A. Each Member's percentage of
Membership Interest in the Company shall be based on his relative capital contributions to the
Company.
.12 PROPERTY
Property shall mean, at any time, all property, whether real or personal, interests, assets or rights
owned or held by or on behalf of the Company at such time.
ARTICLE III
Capital Contributions and Capital Accounts
-01 CAPITAL CONTRIBUTIONS
Upon execution of this Agreement, each Member shall contribute to the Company cash,
securities and/or other assets in the amount set forth opposite his or her respective name on
Schedule A attached hcreto
.02 CAPITAL ACCOUNTS
Separate capital accounts shall be maintained by the Company for each Member The capital
account of each Member shall be credited with his capital contributions (at net fair market value
with respect to contributed property) and shall be appropriately adjusted to reflect each Member's
allocations of profits, gains, losses, deductions, the net fair market value of distributions made to
the Member and such other adjustments as shall be required by Code Sec 704(b) and the
regulations promulgated thereunder
03 LIMITED LIABILITY
The Members shall not have any personal liability for liabilities or obligations of the Company
except to the extent of their capital contribution set forth in Section 301 The Members shall not
be required to make any further or additional contribution to the Company or to lend or advance
funds to the Company for any purpose other than construction of and for payment of the
proposed Bank of Wilmington construction/permanent mortgage for the 18 unit apartment
building, operating expenses, taxes and insurance on the "property" and, Notwithstanding the
foregoing, (i) if any court of competent jurisdiction holds that distributions (or any part thereof)
received by a Member pursuant to the provisions hereof constitute a return of capital and directs
that a Member pay such amount (with or without interest thereon) to or for the account of the
Company or any creditor thereof, such obligation shall be the obligation of said Member and not
of any other Member or the Company, and (ii) a Member shall indemnify and hold harmless the
Company and each Member from any liability or loss incurred by virtue of the assessment of any
tax with respect to such Member's allocable share of the profits or gain of the Company.

.04 NO INTEREST ON OR RIGHT TO WITHDRAW CAPITAL CONTRIBUTIONS
No interest shall be paid by the Company on capital contribution or on the balance in any capital
account and no Member shall have the right to withdraw his capital contribution or to demand or
receive a return of his capital contribution.
ARTICLE IV
Company Funds
All funds received by the Company shall be utilized for Company purposes as determined by the
Manager(s) in the best interests of the Company. Until required for the Company's business, all
Company funds shall be deposited and maintained in such accounts in such banks or other
financial institutions as shall be selected by the Manager(s) Ol shall be invested in securities of
the United States government, certificates of deposit or money market funds designated by the
Manager(s). The Manager(s) or their designee shall have the right to draw checks payable in such
funds and make, deliver, accept and endorse negotiable instruments in connection with the
Company's business. Company funds shall not be commingled with the funds of any other
person.
ARTICLE V
Allocations and Distributions
.01 DISTRIBUTIONS
Cash Flow shall be distributed to the Members in such amounts and at such intervals as the
Manager(s) shall determine and among the Members in proportion to their respective
Membership Interests.
.02 ALLOCATION OF PROFITS AND LOSSES
All profits and losses of the Company shall be allocated among the Members in proportion to
their respective Membership Interests; provided, however, that for federal income tax purposes,
income, gain, loss and deduction, with respect to property contributed to the Company, shall be
shared by the Members so as to take account of the variation between the federal income tax
basis of the property to the Company and its fair market value at the time of its contribution to
the Company utilizing any such method as is selected by the Manager(s) that is authorized
pursuant to Code Sec. 704(c) and regulations relating thereto.

ARTICLE VI
Management: Rights, Powers and Obligations of the Manager( s )
.01 MANAGEMENT AND CONTROL IN GENERAL
(a) Except as set forth in Paragraph 6.01(b), the Manager(s) shall have full and exclusive power
to manage and control the business and affairs of the Company, and the Members shall have no
right to act on behalf of or bind the Company. The Manager(s) shall have all the rights, powers
and obligations of a manager as provided in the Act and as otherwise provided by law, and any
action taken by the Manager(s) shall constitute the act of and serve to bind the Company. In
dealing with the Manager(s), no persons shall be required to inquire into, and all persons are
entitled to rely conclusively on, the authority of the Manager(s) to bind the Company.
(b) Notwithstanding the provisions of Paragraph 6.01(a), the Manager(s) shall not (i) confess a
judgment against the Company or execute or deliver any assignment for the benefit of creditors
of the Company or (ii) sell or assign substantially all the Property in bulk, without the written
consent of the Members holding a majority of the Membership Interests.
02 NUMBER AND APPOINTMENT OF MANAGER(S)
(a) The initial number of Managers of the Company shall be one. Such number may be changed
from time to time upon the affirmative vote of Members holding 2/3 of the Membership Interests
who are present at a meeting called for such purpose, and a Manager may be removed at a
meeting called for such purpose upon the same vote.
(b) A Manager may resign at any time upon prior written notice to the Company. In the event of a
vacancy in the position of Manager by reason of resignation, removal, death or Bankruptcy, a
successor shall be appointed by the affirmative vote of the Members holding a majority of the
Membership Interests who are present at a meeting called for such purpose.
(c) A Manager shall not be required to be a Member of the Company or a resident of North
Carolina.
.03 EMPLOYMENT OF OTHERS, INCLUDING AFFILIATES
The Manager(s) shall not be required to devote full time to the affairs of the Company and shall
devote such time to Company affairs as they in their sole and unrestricted discretion deem
necessary to manage and supervise the operations and business of the Company. Nothing
contained in this Agreement shall preclude the employment by the Manager(s), on behalf of and
at the expense of the Company, of themselves or any agent or third party to operate and manage
all or any portion of the Property or to provide any service relating to the business, subject to the
control of the Manager(s). The Manager(s) may, on behalf of the Company, engage one or more
Affiliates of any of the Manager(s) to render services to the Company, provided that any such
engagement shall be upon terms and conditions no less favorable to the Company than could be
obtained from an independent third party. Neither the Company nor any of the Members shall
have, as a consequence of the relationship created hereby, any right in or to any income or profits
derived by the Manager(s) or an Affiliate of any of the Manager(s) from any business
arrangements with the Company which are consistent with this Section.

.04 COMPENSATION TO MANAGE,R(S)
The compensation of the Manager(s) shall be established from time to time by the affirmative
vote of the Member(s) holding a majority of the Membership Interests who are present at a
meeting called for such purpose.
05 EXPENSES
The Company shall pay all costs and expenses arising from or relating to the organization of the
Company, the acquisition of Property and the commencement and continuation of Company
operations. The Company shall not be required to reimburse the Manager(s) or their Affiliates for
overhead expenses incurred by them in providing services to the Company, but shall be required
to reimburse such parties for reasonable out-of-pocket expenses so incurred by them.
.06 OTHER ACTIVITIES
The Manager(s), an Affiliate of any of the Manager(s) and any Member may engage in or
possess an interest in other business ventures or investments of any kind, independently or with
others, including but not limited to ventures engaged in owning, operating or managing
businesses or properties similar to those businesses or properties owned or operated by the
Company. The fact that a Manager, any Affiliate of a Manager or any Member may avail itself of
such opportunities, either by itself or with other persons, including persons in which it has an
interest, and not offer such opportunities to the Company or to a Member, shall not subject the
Manager, the Member or such Affiliate to liability to the Company or to any other Member on
account of lost opportunity. Neither the Company nor any Member shall have any right by virtue
of this Agreement or the relationship created hereby in or to such opportunities, or to the income
or profits derived therefrom and the pursuit of such opportunities, even though competitive with
the business of the Company, shall not be deemed wrongful or improper or in violation of this
Agreement.
.07 TITLE TO PROPERTY
Title to Property shall be taken in the name of the Company or in the name or names of a
nominee or nominees designated by the Manager(s).
.08 LIABILITY OF A MANAGER
Each Manager and any Affiliate of a Manager, and their respective officers, shareholders,
controlling persons, directors, agents and employees, shall not be liable, responsible or
accountable in damages or otherwise to the Company or to any of the Members, their successors
or permitted assigns, except by reason of acts or omissions due to gross negligence or willful
misconduct. Any action taken in good faith in reliance upon and in accordance with the advice or
opinion of counsel shall be conclusively deemed not to constitute gross negligence or willful
misconduct.

.09 INDEMNIFICATION
The Company shall indemnify, defend and hold harmless any person (the "Indemnified Party")
who was or is a party or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or investigative, against losses,
damages, claims or expenses actually and reasonably incurred by it for which such Indemnified
Party has not otherwise been reimbursed (including reasonable attorneys' fees, judgments, fines
and amounts paid in settlement) in connection with such action, suit or proceeding, by reason of
any acts, omissions or alleged acts or omissions arising out of the Indemnified Party's activities
as a Member, or as an officer, shareholder, director, agent or employee of a Member, on behalf of
the Company or in furtherance of the interests of the Company, so long as the Indemnified Party
did not act in a manner constituting gross negligence or willful misconduct. The termination of
any action, suit or proceeding by judgment, order, settlement, or upon a plea of nolo contendere
or its equivalent, shall not of itself create a presumption that the Indemnified Party's conduct
constituted gross or negligence or willful misconduct.
.10 TAX MATTERS PARTNER
John K Hutchings shall be the "tax matters partner" for purpose of Subchapter C of Chapter 63 of
Subtitle F of the Internal Revenue Code (Code Secs. 6221-6233) and shall have the authority to
exercise all functions provided for in said Act, or in regulations promulgated thereunder by
Treasury, including, to the extent permitted by such regulations, the authority to delegate the
function of "tax matter partner" to any other person. John K Hutchings shall be reimbursed for all
reasonable expenses incurred as a result of his duties as tax matters partner. In the event John K
Hutchings resigns as tax matter partner or as a Manager, or his entire Membership Interest is
disposed of or terminated, Elizabeth Simpson shall become the tax matter partner.
ARTICLE VII
Meetings and Voting
.01 MEETINGS
Meetings of the Members may be called by any Manager or by Members holding at least 10% of
the Membership Interests upon 10 days prior written notice to each Member of the Company.
Such notice shall set forth the time and place of the meeting. If no place for the meeting is
designated, the place of the meeting shall be the principal office of the Company. Members
holding at least 66.67 % of all Membership Interests shall constitute a quorum at any meeting of
Members, whether present in person or by proxy.
.02MANNER OF ACTING
If a quorum is present at a meeting, the affirmative vote of Members holding at least 66.67 % of
all Membership Interests shall be the act of the Members, unless the vote of a greater or lesser
proportion or number is otherwise required by the Act, by the Articles of Organization or by this
Agreement

.03 ACTION BY MEMBERS
Any action required or permitted to be taken at a meeting of Members may be taken without a
meeting if the action is evidenced by a written consent describing the action taken, executed by
each Member and delivered to the Manager(s) for the inclusion in the Company records. Any
action taken pursuant to this .03 shall be effective when all Members have executed the consent,
unless the consent specifies a different effective date
04 WAIVER OF NOTICE
When any notice is required to be given to any Members , a waiver thereof in writing executed
by the person entitled to such notice, whether before, at or after the time stated therein, shall be
equivalent to the giving of such notice.
ARTICLE VIII
Transfers of Membership Interests; Admission of New Members
.01 RESTRICTIONS ON TRANSFER
A Member may not sell or transfer all or any part of his Membership Interest except with the
prior written consent of Members holding 66.67% of the Membership Interests, which consent
may be withheld by a member in his sole and unrestricted discretion. Any sale or transfer
without said consent shall be null and void and confer no rights on the transferee as against the
Company or as against the Members. In addition, before a permitted transferee shall be admitted
to the Company as a substitute or additional Member, the conditions set forth in Section 8.04
must be satisfied.
.02 ADMISSION OF ADDITIONAL OR SUBSTITUTE MEMBERS
No person maybe admitted as an additional or substibite Member without the unanimous written
consent of all Members.
.03 TERMINATION OF MEMBER'S INTEREST IN COMPANY
Upon a Member's death, a Member becoming bankrupt or the termination of a Member's interest
in the Company (by withdrawal or otherwise), such Member's legal representative shall have all
the rights of the Member for the purpose of settling the Member's estate and such power as the
Member possessed to transfer his Membership Interest and to join with the transferee thereof in
satisfying the conditions precedent to such transferee becoming a substitute Member which are
set forth in this Article YV'1I1.
Each Member expressly agrees that in the event of his death he waives on behalf of himself and
his estate, and he directs the legal representative of his estate and any person interested therein, to
waive the fiunishing of any inventory, accounting or appraisal of the assets of the Company and
any right to any audit or examination of the books of the Company. "

.04 SUBSTITUTE OR ADDITIONAL MEMBER
(a) A person shall only be admitted as a substitute or additional Member under this Agreement in
compliance with the following:
(1) a transfer contemplated by Section 8.01 shall be made only by written document, signed
by the transferor Member and accepted in writing by the transferee, and a duplicate original of
such document shall be delivered to the Company and consented to by all Members (which
consent may be withheld in the sole and unrestricted discretion of any Member);
(ii) the transferee shall execute and deliver to the Company a written agreement, in form
reasonably satisfactory to the Man. agree(s), pursuant to which said person agrees to be bound by
this! Agreement and grants the power of attorney contained in this Agreement; and
(b) In the event a transfer is made in accordance with the terms of this Article, unless otherwise
required by the Code:
(i) the effective date of such transfer shall be the date the written documents described in
Subparagraphs 8.04(a)(i) and (ii) are approved by all Members; and
(ii) the Company shall be entitled to treat the transferor Member as the absolute owner of
the transferred Membership Interest in all respects and shall incur no liability for distribution! or
allocations made pursuant to Article V in good faith to such transferor until such time as the
written documents described in Subparagraphs 8.04(a)(i) and (ii) are approved by all Members.
(c) The costs incurred by the Company associated with the Admission of a substitute or
additional Member contemplated by this Article (including reasonable attorneys' fees) shall be
bome by the transferee.
ARTICLE IX
Reports and Tax Matters
.01 BOOKS. RECORDS AND REPORTS
(a) Accurate books, records and reports shall be maintained by the Company showing its
assets, liabilities, operations, transactions and financial condition, as well as the names and
addresses of the Members. The Company hooks and records may he kept under such permissible
method of accounting as the Manager(s) may determine The Company books shall be maintained
at the principal office of the Company, and each Member shall have the right upon reasonable
notice given to the Company to inspect, extract and copy such hooks during regular business
hours of the Company
(b) The Manager(s) shall cause income tax returns for the Company to be prepared and
filed with the appropriate authorities Within (90) after the close of each fiscal year of the
Company, the Managers) shall send to each person who was a Member at any time during such
fiscal year such information as will be sufficient to prepare documents which may be required to
be filed under relevant federal and state income tax laws
(c) Within 60 days after the close of the Company's fiscal year, the Manager(s) shall use their
best efforts to cause each Member to receive financial statements of the Company for the fiscal
year then ended (including a balance sheet and statement of income)

.02 SECTION 754 ELECTION
In the event of a distribution of property made in the manner provided in Section 734 of the
Code, or in the event of a transfer of any Membership Interest permitted by this Agreement made
in the manner provided in Section 743 of the Code, the Manager(s), on behalf of the Company,
may, but shall not be required to, file an election under Section 754 of the Code in accordance
with the procedures set forth ill the applicable regulations promulgated thereunder.
ARTICLE X
Dissolution and Termination
.01 DISSOLUTION OF THE COMPANY
The Company shall dissolve and be terminated on December 312028 or upon the earlier
happening of anyone of the following:
(a) upon written agreement of Members holding 2/3 of the Membership Interests;
(b) upon the death, retirement, resignation, Bankruptcy, court declaration of incompetence
with respect to, or dissolution of, a Member , unless within ninety (90) days after the event there
are at least four (4) remaining Members and at least four Members holding 2/3 of the
Membership Interests agree to continue the business of the Company;
(c) upon the sale of substantially all of the Property or other conversion of substantially all
the Company's assets to cash; or
(d) upon the occurrence of any other event other than one specified in this Section 10.01
which, under the Act or as otherwise provided by law, causes a dissolution and termination of the
Company.
.02 LIQUIDATOR
(a) Upon dissolution of the Company, the Manager(s), or if there is no Manager, such
person as the Members holding a majority of the Membership Interests may designate, shall act
as liquidator of the Company (in either case, the "Liquidator"). The Liquidator shall, with
reasonable speed, wind up the affairs of the Company and liquidate the Property. The Liquidator
shall have unlimited discretion to determine the time, manner and terms of any sale of Property
having due regard to the activity and condition of the relevant market and general financial and
economic conditions. The Liquidator shall distribute any proceeds received from the disposition
of the Property and any other assets of the Company in accordance with the provisions of Article
V.
(b) If any Member shall be indebted to the Company, then until payment of such amount by
him, the Liquidator shall retain such Member's distributive share of Property and apply the same
to the liquidation of such indebtedness.
(c) The Liquidator shall comply with all requirements of the Act and other applicable law
pertaining to the winding up of a limited liability company, following which the Company shall
stand liquidated and terminated.

.03 SOURCE OF DISTRIBUTIONS
Each Member shall look solely to the assets of the Company for all distributions with respect to
the Company, the return of his capital contribution thereto and his share of profits or losses
thereof, and shall have no recourse therefor (upon dissolution or otherwise) against any other
Member or Manager.
ARTICLE XI
Power of Attorney
.01 POWER OF ATTORNEY
Each Member, by executing this Agreement or a counterpart hereof, does hereby irrevocably
constitute and appoint each Manager, and any successor Manager of the Company, with full
power of substitution. , as such Member's true and lawful attorney -in -fact (the Attomey-in-
Fact"), in his name, place and stead, to execute, acknowledge, swear to, deliver, file and record
such documents which are now or may hereafter be required by law to be flied on behalf of the
Company or are deemed necessary or desirable by the Manager(s) to carry out fully the
provisions of this Agreement in accordance with its terms
.02 NATURE OF POWER OF ATTORNEY
The grant of authority in Section 11.01 by each Member (i) is a special power of attorney coupled
with an interest in favor of the Attorney -in -Fact and as such shall be irrevocable and shall survive
the death of legal incapacity of the Member; (ii) may be exercised for the Member by a facsimile
signature of the Attorney -in -Fact; and (iii) shall survive the assignment by the Member of all or
any portion of his Membership Interest, except that where the assignee of the entire Membership
Interest of the Member has furnished a power of attorney and has been approved by the Company
for admission to the Company as a substitute Member pursuant to Article VIII, the power of
attorney granted in Section 11.01 shall survive such assignment for the sole purpose of enabling
the Attorney -in -Fact to execute, acknowledge and file any instrument necessary to effect such
substitution and shall thereafter terminate
ARTICLE XII
Miscellaneous Provisions
.01 NOTICES
All notices or other communications required or permitted to be given pursuant to this
Agreement shall be in writing and shall be considered as properly given: (i) in the case of a report
to be given to a Member, if personally delivered or if mailed by United States first-class mail,
postage prepaid., addressed to such Member at his address on the records of the Company; and
(ii) in the case of notices or communications to be given to any Member, if personally delivered
or if mailed by United States first-class certified or registered mail, return receipt requested,
postage prepaid, or if sent by prepaid telegram or telex, addressed to such Member at his address

on the records of the Company. A Member may change his address for notices by giving notice
in like manner. Any notice or other communication shall be deemed to have been given to, or
received by, the appropriate party as of the date on which it is personally delivered or, if mailed,
on the third business day after the date on which it is deposited in the United States mail, or if
telegraphed or telexed, on the business day after it is transmitted.
.02 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws of the State of
North Carolina.
.03 SUCCESSORS AND ASSIGNS
This Agreement and all the terms and provisions hereof shall be binding upon and shall inure to
the benefit of the Members and their respective heirs, executors, administrators, successors and
permitted assigns. Any person acquiring or claiming an interest in the Company, in any manner
whatsoever, shall be subject to and bound by all the terms, conditions and obligations of this
Agreement to which his predecessor in interest was subject or bound, without regard to whether
such person has executed this Agreement or a counterpart hereof or any other document
contemplated hereby. No person shall have any rights or obligations relating to the Company
greater than those set forth in this Agreement, and no person shall acquire an interest in the
Company or become a Member thereof except as permitted by the terms of this Agreement.
.04 COUNTERPARTS
This Agreement may be executed in any number of identical counterparts, each of which, for all
purposes, shall be deemed an original, and all of which constitute, collectively, one and the same
Agreement. In addition, this Agreement may contain more than one counterpart signature page
and may be executed by the affixing of the signature of each of the Members to one of such
counterpart signature pages, and all such counterpart signature pages shall be read as one and
shall have the same force and effect as though all the signers had signed the same signature page.
.05 ADDITIONAL ASSURANCES
Upon the request of a Manager, each Member agrees to perform all further acts and execute,
acknowledge and deliver any documents which the Manager deems reasonably necessary to
effectuate the provisions of this Agreement.
.06 MODIFICATION TO BE IN WRITING
This Agreement constitutes the entire understanding of the parties hereto with respect to the
subject matter hereof and supersedes any and all prior negotiations, understandings and
agreements in regard hereto. No amendment, modification or alteration of the terms hereto shall
be binding unless the same is in writing and is effected ill accordance with this Agreement.

.07 PARTITION
Each of the parties hereto irrevocably waives during the term of the Company any right that he
may have to maintain any action for partition with respect to Company Property.
.08 NO WAIVER
Failure or delay of any party in exercising any right or remedy under this Agreement, or any other
agreement between the parties, or otherwise, will not operate as a waiver thereof. The express
waiver by any party of a breach of any provision of this Agreement by any other party shall not
operate or be construed as a waiver of any subsequent breach by said party. No waiver will be
effective unless and until it is in written form and signed by the waiving party.
.09 GENDER AND NUMBER
Wherever from the context it appears appropriate, each term stated in either the singular or plural
shall include the singular and plural, and pronouns stated in either the masculine, the feminine or
the neuter gender shall include the masculine, feminine and neuter.
.10 HEADINGS
The captions in this Agreement are inserted for convenience of reference only and shall not affect
the construction of this Agreement. References in this Agreement to any Article, Section,
Paragraph, Sub. paragraph or Schedule are to the same contained in this Agreement.
.11 VALIDITY AND SEVERABILITY
If any provision of this Agreement contravenes any law and such contravention would thereby
invalidate this Agreement, or if the operation of any provision hereof is determined by law,
administrative regulation or otherwise to result in classification of the Company as an association
taxable as a corporation for federal income tax purposes, or to make a Member generally liable
for the obligations of the Company, then such provision is declared to be invalid and subject to
severance from the remaining portion of this Agreement, and this Agreement shall be read and
construed as though it did not contain such provision in a manner to give effect to the intention of
the parties to the fullest extent possible.
.12 NO THIRD -PART Y RIGHTS
This Agreement and the covenants and agreements contained herein are solely for the benefit of
the parties hereto and their Affiliates. No other person shall be entitled to enforce or make any
claims, Or have any right pursuant to the provisions of this Agreement.

APR-13-2004 11:15 PM
P. 01
APR-13-2004 12s24 FROMIPMOIHOST 9107960750 70;15517764J664
IN WITNESS WHEREOF, the Members have oaused this Agreement to be executed this the
i 5th Day of March 2004
STATE OF NORTH CAROLINA I
SS;
COUNTY OF NEW HANOVER )
P.1'l1
I Marie D Jcnkina, a notary Public in and for the said Comity and State, do hereby certify that
John K Hutchings. Vanda M Hutcbinp. Mark R Simpson, Elizabeth A Simpson personally
known to me to be the same persons whoac nwes are subscribed to the forolong instrument,
appeared before me this day in person and :acknowledged and swore tit the statements set forth
in the foregoing instrument arc true and correct staid that he (she) signtd and delivered the said
imstn:unant as his (her) free and voluntary act for the usea and purposes therein set forth,
API-. /
Given under my hand and official seal this _ day of 44archr2004
(SEAL) v 4V Notary Public
My Commission Expires: 22,Z6r'&!e _

SCHEDULE A
OPERATING AGREEMENT OF H & S DEVELOPMENT OF WILMINGTON L.L.C.
Name & Address of Member Capital Contribution Interest
John K Hutchings Jr $ 50,000.00 25%
PO Box 1683
Carolina Beach, NC 28428
Vanda M Hutchings $ 50,000.00 25%
PO Box 1683
Carolina Beach, NC 28428
Mark R Simpson $ 50,000.00 25%
5202 Carolina Beach Rd Suite C
Wilmington, NC 28412
Elizabeth A Simpson $ 50,000.00 25%
5202 Carolina Beach Rd Suite C
Wilmington, NC 28412