DECLARATION OF COVENANTS CONDITIONS AND RESTRICTIONS

DECLARATION OF COVENANTS CONDITIONS AND RESTRICTIONS This Declaration, made on the date hereinafter set forth by PAREC Realty Skippack Associates, a Pennsylvania Limited Partnership, (hereinafter referred to as Declarant ) W I T N E S S E T H; WHEREAS, Declarant is the owner of certain property in Skippack Township, Montgomery County, Commonwealth of Pennsylvania, know and described as Phase 4 of subdivision know as Carriage Run, which property is more particularly described on Exhibit A attached hereto and made a part hereof. Now, THEREFORE, Declarant hereby declares that the property described on Exhibit A shall be held, sold and conveyed subject to the following easements, restrictions, covenants, and conditions, which are for the purpose of protecting the value and desirability of, and which shall run with the land and be binding on all parties having any right, title or interest in the described property or any part thereof, their heirs, successors and assigns, and shall insure to the benefit of such owner thereof. ARTICLE I. DEFINITIONS Section 1 Association shall mean and refer to Carriage Run Phase 4 Homeowners Association, its successors and assigns. Section 2 Common Area shall mean all common open space (including the improvements thereto) owned by the Association for the common use and enjoyment of the owners. The Common Area to be owned by the Association at the time of the conveyance of the first lot shall be all open space, undedicated roads and other unlotted areas. Section 3 Declarant shall mean and refer to Parec Realty Skippack Associates, its successors and assigns if such successors or assigns should acquire more than one undeveloped lot from the Declarant for the purpose of development. Section 4 Lot shall mean and refer to any plot of land shown upon any recorded subdivision plan of the property with the exception of the Common Area. Section 5 in Article III Member shall mean and refer to the members of the Association, qualified as provided Section 6 Owner shall mean and refer to the record owner, whether one or more persons or entities, of a free simple title to any Lot which is a part of the Property, as having such interest merely as security for the performance of an obligation. Page 1 of 12

Section 7 Property shall mean and refer to (1) that certain real estate described in Exhibit A ; and (2) such additions thereto as may hereafter be brought within the jurisdiction of the Association. ARTICLE II PROPERTY RIGHTS Section 1 Owners Easements of Enjoyment. Every Owner shall have a right and easement of enjoyment in and to the Common Area, which shall be appurtenant to and shall pass with the title to every Lot, subject to the following provisions: (a) (b) (c) Section 2 The right of the Association to charge reasonable admission and other fees for the use of any recreational facility situated upon the Common Area; The right of the Association to suspend the voting rights and rights to use of the recreational facilities by an Owner for any period during which any assessment against his Lot remains unpaid; and for a period not to exceed 60 days for any infraction of its published rules and regulations; The right of the Association to dedicate or transfer all or any part of the Common Area to any public agency, authority, or utility for such purposes and subject to such conditions as may be agreed to by the members. Except where such dedication is required by the final record plan, no such dedication or transfer shall be effective unless an instrument agreeing to such dedication or transfer signed by two-thirds of each class of members has been recorded. Delegation of Use Any Owner may delegate, in accordance with the By-Laws, his right of enjoyment to the Common Area and Facilities to the members of his family, his tenants, or contract purchasers who reside on the Lot owned by him. ARTICLE III MEMBERSHIP AND VOTING RIGHTS Section 1. Every Owner of a Lot which is subject to assessment shall be a Member of the Association. Membership shall be appurtenant to and may not be separated from ownership of any Lot which is subject to assessment. Membership shall not include persons or entities that hold an interest merely as security for the performance of an obligation. Page 2 of 12

Section 2. The Association shall have two classes of voting membership: Class A. Class A members shall be all Owners, with the exception of the Declarant, who shall be entitled to one vote for each Lot owned. When more than one person holds an interest in any Lot, all such persons shall be members. The vote for such Lot shall be exercised as they determine, but in no event shall more than one vote be cast with respect to any Lot. Class B. The Class B members shall be the Declarant and shall be entitled to three (3) votes for each Lot owned. The Class B membership shall cease and be converted to Class A membership on the happening of either of the following events, whichever occurs earlier: (a) when the total votes outstanding in the Class A membership equal the total votes outstanding in the Class B membership, or (b) on December 31, 1991. ARTICLE IV. COVENANT FOR MAINTENANCE ASSESSMENTS Section 1. Creation of the Lien and Personal Obligation of Assessments. The Declarant, for each Lot owned within the Property, hereby covenants, and each Owner of any Lot by acceptance of a deed therefore, whether or not it shall be so expressed in such deed, is deemed to covenant and agree to pay to the Association: (1) annual assessments or charges, and (2) special assessments for capital improvements, such assessments to be established and collected as hereinafter provided. The annual and special assessments, together with interest, cost and reasonable attorney s fees shall be a charge on the land and shall be a continuing lien upon the property against which each such assessment is made. Each such assessment, together with interest, costs, and reasonable attorney s fees, shall also be the personal obligation of the person who was the Owner of such Property at the time when the assessment fell due. The personal obligation for delinquent assessments shall also pass to successors in title. Section 2. Purpose of Assessments. The assessments levied by the Association shall be used exclusively to promote the recreation, health, safety, and welfare of the residents in the Property and for the improvement and maintenance of the Common Area, including, but not limited to, all cost of labor, materials, insurance, taxes, and reasonable replacement reserves there for. Page 3 of 12

Section 3. Annual and Special Assessments. (a) Annual Assessments: The annual assessments shall be used exclusively to promote the health, safety, and welfare of the Members and, in particular, to improve, maintain, lease, and operate the Common Area and facilities, including funding of appropriate reserves for future repair and replacement. By a vote of a majority of the Directors, the Board shall fix each annual assessment in an amount sufficient to meet the obligations imposed by the Declaration. In the event the Board fails to fix an assessment for any fiscal year, then each assessment established for the prior year shall automatically be continued until such time as the Board acts. (b) Special Assessments: The Association may levy a special assessment against each Unit, for the purpose of defraying, in whole or in part, the cost of any construction, reconstruction, repair and replacement of a capital improvement upon the Common Area, including fixtures and personal property; provided that any such assessment shall have the assent of twothirds of the Owners. Section 4. Notice and Quorum for Any Action Authorized Under Section 3 and 4. Written notice of any meeting called for the purpose of taking any action authorized under Section 3 or 4 shall be sent to all Members not less than 30 days nor more than 60 days in advance of the meeting. At the first such meeting called, the presence of Members or of proxies entitled to cast sixty (60) percent of all the votes of each class of membership shall constitute a quorum. If the required quorum is not present, another meeting may be called subject to the same notice requirement, and the required quorum at the subsequent meeting shall be one-half (1/2) of the required quorum at the preceding meeting. No such subsequent meeting shall be held more than 60 days following the preceding meeting. Section 5. Uniform Rate of Assessment. Both annual and special assessments must be fixed at a uniform rate for all Lots and may be collected on a monthly basis. Page 4 of 12

Section 6. Date of commencement of Annual Assessments: Due Date. The annual assessments provided for herein shall commence as to any Lot on the later of (a) the first day of the month following the conveyance of the Common Area, or (b) the granting of an occupancy permit for the dwelling constructed on any Lot. The first annual assessment shall be adjusted according to the number of months remaining in the calendar year. The Board of Directors shall fix the amount of the annual assessment against each Lot at least thirty (30) days in advance of each annual assessment period. Written notice of the annual assessment shall be sent to every Owner subject thereto. The due dates shall be established by the Board of Directors. The Association shall, upon demand, and for a reasonable charge, furnish a certificate signed by an officer of the Association setting forth whether the assessments on a specified Lot have been paid. A properly executed certificate of the Association as to the status of assessments on a Lot is binding upon the Association as of the date of its issuance. Section 7. Effect of Nonpayment of Assessments: Remedies of the Association. Any assessment not paid within thirty (30) days after the due date shall bear interest from the due date at the rate of ten (10) percent per annum. The Association may bring an action at law against the Owner Personally obligated to pay the same, or foreclose the lien against the Property. No Owner may waive or otherwise escape liability for the assessments provided for herein by non-use of the Common Area or abandonment of his Lot. Section 8. Subordination of the Lien to Mortgages. The lien of the assessments provided for herein shall be subordinate to the lien of any first mortgage. Sale or transfer of any Lot shall not affect the assessment lien. However, the sale or transfer of any Lot pursuant to mortgage foreclosure or any proceeding in lieu thereof, shall extinguish the lien of such assessments as to payments which became due prior to such sale or transfer. No sale or transfer shall relieve such Lot from liability for any assessments thereafter becoming due or from the lien thereof. Section 9. Exempt Property. All property dedicated to, and accepted by a local public authority or municipal body shall be exempt from the assessments created herein. Section 10. Liability of Declarant for Payment of Assessments. Notwithstanding any herein to the contrary, the Declarant shall have no obligation to pay any annual or special assessments for capital improvements for any Lot owned by it except for any Lot on which a residential dwelling unit has been erected and which is occupied by Declarant, a tenant of Declarant, or any other occupant by permission of Declarant. Page 5 of 12

ARTICLE V. PARTY WALLS Section 1. General Rules of Law to Apply. Each wall which is build as a part of the original construction of the home upon the Property and placed on the dividing line between the Lots shall constitute a party wall, and, to the extent not inconsistent with the provisions of this Article, the general rules of law regarding party walls and liability for property damage due to negligence or willful acts or omissions shall apply thereto. Section 2. Sharing of Repair and Maintenance. The cost of reasonable repair and maintenance of a party wall shall be shared by the Owners who make use of the wall in proportion to such use. Section 3. Destruction by Fire or Other Casualty. If a party wall is destroyed or damaged by fire or other casualty, any Owner who has used the wall may restore it, and if the other Owners thereafter make use of the wall, they shall contribute to the cost of restoration thereof in proportion to such use without prejudice, however, to the right of any such Owner to call for a larger contribution from the other Owners under any rule of law regarding liability for negligent or willful acts or omissions. Section 4. Weatherproofing. Notwithstanding any other provision of this Article, an Owner who by his negligent or willful act causes the party wall to be exposed to the elements shall bear the whole cost of furnishing then necessary protection against such elements. Section 5. Right to Contribute Runs with Land. The right of any Owner to contribution from any other Owner under this Article shall be appurtenant to the land and shall pass to such Owner s successors in title. Page 6 of 12

ARTICLE VI. USE OF PROPERTY Section 1. Protective Covenants. (a) Nuisances. No nuisance shall be permitted to exist or operate upon any Property so as to jeopardize property values or to be detrimental to the well being of Members. Nothing in this provision, however, shall in any manner limit the powers granted by law as may either now exist or are hereafter established in the Township with respect to control and abatement of nuisance. (b) Restriction of Further Subdivision. No private yard upon which a Unit has been constructed shall be further subdivided or separated into smaller private yards by any Owner and no portion less than all of any such private yard nor any easement or other interest therein, shall be conveyed or transferred by an Owner, provided this shall not prohibit deeds of correction, deed to resolve boundary line disputes and similar corrective instruments. (c) Leasing. No Unit shall be rented for transient or hotel purposes or in any event for an initial period of less than six (6) months. No portion less than all of any Unit shall be leased for any period. No Owner shall lease a Unit other than on a written form of lease requiring the lessee to comply with this Declaration and providing that failure to comply constitutes a default under the lease. The Board of Directors may provide a suggested standard lease form for use by Owners. Each Owner of a Unit shall, promptly following the execution of any lease of a Unit, forward a confirmed copy thereof to the Board of Directors. The foregoing provisions of this subparagraph except the restriction against use for hotel or transient purposes, shall not apply to the Declarant or to a Mortgagee in possession of a Unit as a result of a foreclosure or other judicial use. (d) Rules. From time to time, the Board of Directors may adopt general rules, including but not limited to, regulate potential problems relating to the use of Property and the well being of Member, such as keeping of animals, storage and use of all vehicles, storage and uses of machinery, use of outdoor drying lines, antennae, signs, trash and trash containers, maintenance and removal of vegetation on the Property. General rules may only be adopted or amended by a majority vote of the Board of Directors. Notwithstanding such rules, there shall be no exterior antennae or satellite dishes. All such general rules and any subsequent amendments thereto shall be placed in the Book of Resolutions and shall be binding on all Members except where expressly provided otherwise in such rule. Page 7 of 12

(e) Exceptions. The Board of Directors may issue temporary permits to except any prohibitions expressed or implied by this section, provided the Board can show good cause and acts in accordance with adopted guidelines and procedures. So long as the Declarant is engaged in developing or improving any portion of the Property, it shall be exempted from rules affecting movement, disposition and storage of building materials and equipment, erection and maintenance of directional and promotional signs and conduct of sale activities, including maintenance of model living units. Such exemption shall be subject to such rules as may be established by the Declarant to maintain reasonable standards of safety, cleanliness and general appearance of the Property. (f) Residential Use. All Property designated for residential use shall be used, improved and devoted exclusively to residential use. Nothing herein shall be deemed to prevent the Owner from leasing a Unit to a single family, subject to all of the provisions of the Declaration and rules adopted. (g) Signs. No sign of any kind shall be displayed in public view on a Unit or Common Area without the prior written consent of the Association, except customary name and address signs. (h) Mailboxes. Only mailboxes meeting the design standards of the Association shall be permitted, except for mail depositories of the U.S. Postal Service. (i) Maintenance of Property. Each Owner shall keep all Lots owned by him, and all improvements therein or thereon, in good order and repair and free of debris, all in a manner and with such frequency as is consistent with good property management. In the event an Owner of any Lot in the Property shall fail to maintain the premises and the improvements situated thereon, as provided herein, the Association, after notice to the Owner as provided in the By-Laws and approved by two-thirds vote of the Board of Directors, shall have the right to enter upon said Lot to correct drainage and to repair, maintain and restore the Lot and the exterior of the buildings and any other improvements erected thereon. All costs related to such correction, repair or restoration shall become a Special Assessment upon such Lot. (j) Use of Common Area Limited to Owners. Use of the Common Area is limited to the Declarant, the Owners, their families, lessees and guest. (k) The Association shall be solely responsible for the maintenance of the parking areas, mowing of all lawns and the planting, pruning and cutting of all common area trees and shrubbery. (See Amendment dated 7/25/89 Attached.) Page 8 of 12

Section 2 Cross Easements. There is hereby granted and created a blanket easement upon, across and over the foot paths and roadways upon the Property for pedestrian and vehicular passage, and for the parking of vehicles, and for ingress, egress and regress to and from the roadways adjoining the Property and in, to, upon, through and over the Common Area. The easements, rights and privileges granted hereby shall be for the benefit of and be restricted solely to the Declarant and to Owners from time-to-time of all or any portion of the Property, but such Owners may grant the benefit of such easements, rights and privileges to its tenants now or hereafter occupying a building or portions thereof on the Property for the period of such tenancy, but the same is not intended, and shall not be construed as creating any rights in and for the benefit of the general public. Section 3. Utility Easements. There is hereby granted and created a blanket easement upon, across, over, through, and under the Property for ingress, egress, installation, replacement, repair, and maintenance of all utility and service lines and systems including, but not limited to, water, sewers, gas, telephones, electricity, television cable or communication lines and system. By virtue of this easement, it shall be expressly permissible for this Association, the Declarant or the providing utility or service company to install and maintain facilities and equipment on said property, to excavate for such purposes and to affix and maintain wires, circuits, and conduits on, in and under the roofs and exterior walls of said residences, providing such Company restores disturbed areas to the condition in which they were found. Notwithstanding anything to the contrary contained in this section, no sewers, electrical lines, waterlines, or other utility service lines or facilities for such utilities may be installed or relocated on said premises except as approved by the Declarant prior to the conveyance of the first Lot to an Owner or by the Declarant thereafter. This easement shall in no way affect any other recorded easements on said premises. This easement shall be limited to the replacement and improvement, and not expansion, of any utility facility constructed pursuant hereto. Page 9 of 12

Section 4. Declarant s Construction Easement and Easement to Correct Drainage. The Declarant further reserves a blanket easement on, over and under the Property, including the Common Elements, to move and use construction equipment as Declarant shall deem necessary or advisable in connection with construction and development of the Property, including without limitation construction of houses on the Lots and improvements and structures on the Common Elements. The Declarant reserves a blanket easement and right on, over and under the Property to maintain and to correct drainage of surface water in order to maintain reasonable standards of health, safety and appearance. Such right expressly includes the right to cut any trees, bushes or shrubbery, make any grading of the soil, or to take any other similar action reasonably necessary, following which the Declarant shall restore the affected property to its original condition as near as in practicable. The Declarant shall give reasonable notice of intent to take such action to all affected Owners, unless in the opinion of the Declarant an emergency exists which precludes such notices. Section 5. Architectural Control. No building, fence, wall or other structure shall be commenced, erected or maintained upon the Property, nor shall any exterior addition to or change or alteration therein be made until the plans and specifications showing the nature, kind, shape, height, materials, and location of the same shall have been submitted to and approved in writing as to harmony of external design and location in relation to surrounding structures and topography by the Board of Directors of the Association, or by an architectural committee composed of three (3) or more representatives appointed by the Board. In the event said Board, or its designated committee, fails to approve or disapprove such design and location within thirty (30) days after said plans and specifications have been submitted to it, approval will not be required and this Article will be deemed to have been fully complied with. ARTICLE VII. GENERAL PROVISIONS Section 1. Enforcement. The Association, or any Owner, shall have the right to enforce, by any proceeding at law or in equity, all restrictions, conditions, covenants, reservations, liens and charges now or hereafter imposed by the provisions of this Declaration. Failure by the Association or by any Owner to enforce any covenant or restriction herein contained shall in no event be deemed a waiver of the right to do so thereafter. Page 10 of 12

Section 2. Severability. Invalidation of any one of these covenants or restrictions by judgment or court order shall in no wise affect any other provisions, which shall remain in full force and effect. Section 3. Amendment. The covenants and restrictions of this Declaration shall run with and bind the land, for a term of twenty (20) years from the date this Declaration is recorded, after which time they shall be automatically extended for successive periods of ten (10) years. This Declaration may be amended during the first twenty (20) year period by an instrument signed by not less than ninety (90) percent of the Lot Owners, and thereafter by an instrument signed by not less than seventy-five (75) percent of the Lot Owners. Notwithstanding the foregoing, Declarant reserves the right, at its sole discretion, to amend this Declaration without the consent of any of the Lot Owners if the Mortgagee which is consenting to, and joining in, this Declaration shall require such amendment. Any amendment must be recorded. Further, notwithstanding any contrary provision herein contained, Declarant reserves the right, without the consent of the Lot Owners or the Mortgagee, to relocate any Lot or Lots within the Property and modify the descriptions of Property and Common Area to reflect such relocations. Section 4. Annexation. Additional residential Property and Common Area may be annexed to the Property with the consent of two thirds (2/3) of each class of members. IN WITNESS WHEREOF, the undersigned, being the Declarant herein, has hereunto set its hand and seal this day of September 28, 1988. PAREC REALTY SKIPPACK ASSOCIATES Parec Realty, Inc., General Partner Page 11 of 12

AMENDMENT TO DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS The Declaration of Covenants, Conditions and Restrictions of Parec Realty Skippack Associates, dated September 28, 1988, is here by amended as follows: Articles VI, Section 1. (k) is hereby amended to provide in full as follows: (k) The Association shall be solely responsible for the maintenance of the parking areas, mowing of all lawns, and the pruning and cutting of all common area trees and shrubbery. In witness whereof, the undersigned have hereto set their hands and seals this 25 th day of July, 1989. Parec Realty Skippack Associates BY: Parec Realty, Inc. COMMONWEALTH OF PENNSYLVANIA: COUNTY OF Montgomery On this 28 day of September, 1988, before me, a Notary Public, the undersigned officer, personally appeared ROBERT AYERLE, who acknowledged himself to be the president of Parec Realty, Inc., General Partner of Parec Realty Skippack Associates, and that he as such authorized officer, being authorized to do so, executed the foregoing instrument for t he purposes therein contained. IN WITNESS WHEREOF, I hereunto set my hand and official seal. Page 12 of 12