By-laws of Lake Forest Association, Inc.
with amendments through May 2003
(current as of September 2003)
Article I. Members and Meetings
Section 1. Any person or group of persons who own one or more lots in either Lake Forest Estates as developed
by Mortgage Insurance Corporation, or its successor, shall, upon presentation of satisfactory evidence of
ownership to the Secretary of this corporation, be a member of this corporation.
Section 2. Semi-annual meetings of the members shall be held in April and October of each year for the
transaction of such business as may properly come before such meetings. At the October meeting, in addition to
any other business, the directors shall be elected. The Secretary shall cause a notice to be mailed to each
member at least ten days prior to such meeting designating the
time and place thereof.
Section 3. A special meeting may be called by the Chairman or Acting Chairman or by a majority of the Board of
Directors or on petition of twenty-five or more voting members and the Secretary shall give at least ten days
notice by mail to each member stating the time, place, and purpose of the meeting; and at any special meeting
no business other than that stated in such notice shall be transacted without the unanimous consent of all the
members present thereat.
Section 4. The Secretary shaI1 maintain a voting list of the members and such list shall be available at any
regular or special meeting of the members.
Section 5. At all meetings of the members there shall be present either in person or by proxy twenty-five
voting members in order to constitute a quorum.
Section 6. No one shall exercise more than two proxies at any regular or special meeting.
Section 7. At all regular or special meetings of the members, any person or group of persons owning one or
more lots in the Lake Forest Estates, and who has properly listed that fact with the Secretary, shall be
entitled to one vote; and for the purpose of voting, if the lot is owned by a husband and wife, or by two or
more persons, then either person present may vote or if two or more are present, the entire group shall
designate the person to vote upon all questions before the meeting. A person or group of persons who own more
than one lot shall be entitled to only one vote.
Section 8. Except for the election of directors and unless a roll caI1 is demanded by one-tenth of the voting
members present, voting on any matter of business shall be by voice vote or show of hands. A simple majority
shall carry any matter.
Section 9. The Board of Directors shall have the right to waive the April meeting and in lieu thereof may
cause to be submitted to the members a statement giving any pertinent information on the condition of the
corporation.
Section 10. Any member who elects not to pay all dues and assessments of the corporation shall be deemed a
Non-Participating Member. A Non-Participating Member, for the period during which any dues and assessments are
outstanding, shall have no right to vote on corporation matters or to hold office in the corporation, and
shall have no right to use the corporation's property. Non-Participating status shall be determined by the
Board no less than eight weeks after announcement of annual dues and assessments and only after explicit
notification to the member of the total arrears status and the date on which delinquency status will take
effect (except that Non-Participating status will take effect immediately upon notice from a member).
Non-Participating status may be cleared at any time by payment of the current arrears plus, at the Board's
option, a reasonable administrative fee as determined from time to time by the Board, and the member shall be
immediately reinstated. Non-Participating status applies to the property on which a member resides, and
conveys with the sale of the property to a new owner.
Section 11. (a) The Board is authorized but not required to grant certain privileges, described below, to a limited number of applicants from among:
(i) owners of one or more lots within any neighborhood cluster in the general vicinity of Lake Forest Estates, as designated by the Board from time to time in its discretion, and
(ii) previous members of the corporation (of any classification), regardless of current residence.
Applicants to whom the Board grants those privileges will be known as “Associate Members.”
(b) Associate Members shall have no right to vote on corporation matters or to hold office in the corporation. Associate Members shall have the other rights and privileges of the corporation's regular members for the duration of their Associate Membership, including the right to serve on committees and to participate in discussion at meetings.
(c) In no event shall any new Associate Members be accepted if the total number of Associate Members would exceed the number of Non-Participating Members for that year as determined eight weeks after announcement of annual dues and assessments or fifty Associate Members, whichever is lower. The Board may further limit the number of Associate Members. In establishing such limitations, the Board shall take into account the impact of Associate Members on Association resources and the ability of Associate Members to provide additional, necessary funding to the corporation, including funding for the expected dredging costs, the need for which funding arises from the failure of lot owners within Lake Forest Estates to make special payments and to pay annual membership dues to the corporation
(d) The Board may in its discretion grant Associate Membership privileges to an eligible person or persons, but for no more than three years past the date of the Board’s action. Associate Members whose membership expires may apply for renewal, but no grant of Associate Membership creates any right or presumption of renewal. The Board shall establish fees to be charged to Associate Members and may establish additional rules governing the terms and conditions of Associate Membership.
Article II. Directors
Section 1. The affairs of the corporation shall be managed by a Board of Directors and shall consist of not
less than six nor more than fifteen and, until the maximum number has been reached, the number of directors to
be elected shall be the smallest number which provides at least one director for each twenty-five voting
members or major fraction thereof. Any voting member of the corporation shall be eligible to be a director.
Directors shall be elected for a term of three years at the October general membership meeting, except as
hereinafter otherwise provided for filling vacancies. In elections adjustments in terms shall be made so that
approximately one-third of the directors shall be elected annually for a three year term.
Section 2. The Directors shall be chosen by plurality of the members voting either in person or proxy at the
October meeting. Prior to the October meeting of the corporation, the nominating committee shall determine
whether the number of directors shall be increased or decreased and the length of the term of office to be
filled and if the number of directorships is to be increased, whether they shall be for a one year term or a
two year term. Each voting member may cast one vote for each position to be filled. The nominating committee
shall consist of the Chairman of the corporation and one other member of the board, serving with three persons
from the General Membership appointed by the Chairman.
Section 3. Vacancies on the Board occurring during the year shall be filled for the unexpired term by a
majority vote of the Directors at any regular meeting of the Board, or at any special meeting called for that
purpose, provided however, increases in membership between elections shall no be construed as creating
vacancies.
Section 4. A Director may be removed from office with or without cause by vote of a majority of the members
entitled to vote. Such vote shall be held at the next regular meeting following petition for such vote filed
by at least twenty-five members and provided notice thereof is included in the call for such meeting.
Section 5. A vacancy shall be considered to ha~ occurred when the director dies, resigns, or is removed by
vote, or when such Director disposes of his interest in all lots in Lake Forest Estates.
Section 6. The Board of Directors may adopt such rules and regulations for conduct of their meeting as they
may deem proper and which are not inconsistent with the laws of the State of
North Carolina.
Section 7. The Board of Directors shall hold such regular meetings as it may by motion determine, and special
meetings whenever called by the Chairman and upon three days notice to each Director.
Section 8. The officers of the corporation shall be officers of the Board of Directors.
Section 9. The Board of Directors shall serve without compensation provided the Board may compensate any
Director for unusual expenses incurred by him in the interest of the corporation when such expense was
authorized in advance by the Board.
Section l0. The Board of Directors shall appoint three members to serve with the Chairman and Secretary as an
Executive Committee which shall be authorized to conduct such business of the corporation as the Board of
Directors may from time to time delegate to it. These appointed members need not be directors.
Section 11. A regular meeting of the Board of Directors shall be held within one week following any general
meeting of the corporation to carry out the actions and wishes of the membership and such other business as
may come before it and shall meet during the months of March and September of each year to prepare the agenda
for the general meetings.
Section 12. The Board of Directors shall enforce the rules and regulations adopted at any meeting of the
membership, and shall have power to adopt and enforce any interim rules and regulations. Any such action of
the Board of Directors shall be submitted to the next meeting of the membership for its approval or rejection.
Section 13. A majority of the Directors shall constitute a quorum for transaction of any business of the
corporation.
Article III. Officers
Section 1. The officers of the corporation shall be a chairman, a vice-chairman, a secretary, and a treasurer.
Section 2. The Board of Directors, within one week after the annual meeting in October, shall by a majority
vote choose one of their members as chairman, one as vice-chairman, one as secretary, and one as treasurer,
and each of such officers shall serve for a term of one year and until his successor has been elected and
qualified.
Section 3. Any officer may be removed from such office by a majority vote of the Board of Directors.
Section 4. The officers shall serve without compensation except that the Board of Directors may compensate any
officer for expenses incurred by him in the interest of the corporation when such expense was authorized by
the Directors in advance.
Section 5. The Chairman shall preside at all meetings of the Board of Directors and shall act as Chairman and
call to order all meetings of the members and shall perform all the duties usually incidental to the office of
Chairman. He shall appoint all standing and ad hoc committees provided in the by-laws or by action of the
membership or directors.
Section 6. The Vice-Chairman shall in the absence or incapacity of the Chairman perform the duties of that
office.
Section 7. The Secretary shall keep the minutes of the meetings of the Board of Directors and also the minutes
of the meetings of the members. He shall attend to preparation and mailing of all notices of the corporation
and shall have charge of the books and papers and shall keep a record of all of the voting members of the
corporation and shall perform all duties incidental to his office.
Section 8. The Treasurer shall have the care and custody of the funds of the Corporation and deposit the same
in the name of the Corporation in such bank as the Directors may select and shall pay all bills authorized by
the Directors and shall perfoffi1 all the duties incidental to this office, and shall provide such bond as the
Directors may require.
Article IV. General
Section 1. The books of the corporation shall close when any general meeting has been called to order and any
member desiring to vote in any general meeting shall, prior to the closing of the books, demonstrate to the
Secretary his qualifications as a voting member and shall, upon the request of the Secretary, exhibit his deed
for the property with the recording date thereon and shall sign a statement if requested, that he is still the
owner of the property.
Section 2. This Corporation is a non-profit Corporation and thereon no dividends shall be paid.
Section 3. The seal of the corporation shall be in the foffi1 of a circle and shall bear the name of the
corporation and the year of its incorporation.
Section 4. The failure to notify any property owner in Lake Forest Estates of any regular or special meeting
shall not be cause of action against the Corporation or any officer thereof, unless the property owner has
made himself known to the Secretary and has kept the Secretary informed of his proper mailing address.
Section 5. Unless otherwise provided all meetings shall be conducted according to Roberts Rules of Order.
Article V. Amendments
Section 1. These by-laws may be amended at any regular membership meeting by a two-thirds vote of the members
present, either in person or by proxy provided the proposed amendment has been inserted in the notice of the
call of such meeting.
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