SECOND AMENDED AND RESTATED

PROTECTIVE COVENANTS AND RESTRICTIONS

OF

HOLIDAY ISLE

WHEREAS, Protective Covenants and Restrictions for Holiday Isle Subdivision were recorded in Official Record Book 256, at Pages 416-430, inclusive, of the Public Records of Okaloosa County, Florida, on December 21, 1962, and

WHEREAS, amendments to said Protective Covenants and Restrictions were adopted and respectively recorded as follows: Official Records Book 1042 at Pages 73-82, inclusive, on June 11, 1979; Official Records Book 1291 at Pages 1562-1568, inclusive, on May 6, 1985; Official Records Book 2105 at Pages 2484-2485, inclusive, on October 28, 1997; Amended and Restated Protective Covenants and Restrictions at Official Records Book 2243 at pages 3551-3563, inclusive on March 17, 2000; Official Records Book 2805 at page 4661 on September 7, 2007, and Official Records Book 2811 at pages 3733-3735, inclusive, on October 18, 2007, all in the Public Records of Okaloosa County, Florida;and

WHEREAS, pursuant to the provisions of Article VI hereof, the approval of a majority of the votes cast by leaseholders/owners who are voting members of the Association has been obtained to amend said Amended Protective Covenants and Restrictions as hereinafter set out.

NOW, THEREFORE, the undersigned Association, successor in interest to White Sands Development Corporation and CBS Development Corporation, having succeeded to this interest by virtue of an Agreement and Transfer dated the 20th day of August, 1977, recorded in Official Records Book 928, at pages 968 Through 972, inclusive, of the Public Records of Okaloosa County, Florida, and being vested with all rights and liabilities therein, hereby files, declares, and amends said Amended and Restated Protective Covenants and Restrictions as follows:

1.This amended declaration shall constitute a covenant running with the land and these Second Amended Protective Covenants and Restrictions (“Covenants”) shall be for the benefit of and limitation upon all present and future leaseholders/owners and do hereby define the only uses permitted or allowed.

2.These Covenants, as amended, supersede all prior Protective Covenants and Restrictions and shall run with the land and be binding on all parties and all persons claiming under them for a period of thirty years from the date of this amendment after which time they shall be extended automatically for successive ten year periods, unless written consent of the voting majority of the leaseholders/owners of real property on “Holiday Isle” as defined in paragraph 3 below has been obtained agreeing to change the Covenants in whole or in part.

3.These Covenants, as amended, attach to and govern all platted areas of the Holiday Isle Subdivision as originally filed and hereinafter filed or amended and further attaches to and governs any lot, parcel, block or part, when said Covenants have attached to any lot, block or part by virtue of leasehold agreement, sublease, assignment of lease, or other agreement, all of which property is hereinafter called “Holiday Isle”.

ARTICLE I

DEFINITIONS

As used in this Declaration, the terms below shall have the following meanings:

Section 1.1Architectural Review Board. Architectural Review Board shall mean a Board appointed by the Board of Directors to review building plans, plot plans, and specifications for conformity, harmony, and quality of external structural design.

Section 1.2 Association. “Association” shall mean the Holiday Isle Improvement Association.

Section 1.3Board. “Board” shall mean the Board of Directors of the Holiday Isle Improvement Association.

ARTICLE II

SINGLE FAMILY RESIDENTIAL AREA COVENANTS

Section 2.1Classifications. Residential Sections 1,2,3,4 and 5 are classified as Single Family Residential Areas. The Single Family Residential Area Covenants in this part and the General Covenants in Article IV shall apply to the following Blocks and Lots:

Block A: Lots 1 through 5;

Block B: Lots 1 through 13;

Block C: Lots 1 through 15;

Block D: Lots 1 through 8;

Block E: Lots 1 through 95;

Block F: Lots 1 through 112.

Section 2.2Uses. Within any Residential Section listed above, no building, structure or premises shall be used, arranged, designed or built except for the following:

(a)A detached residence for a single family unit. A family consists of persons related by blood or marriage. Domestic employees may be housed on the premises while the family is present without being considered as a separate family or families. The term “family” shall not be construed to mean a fraternity, sorority, club, institutional group or multiple family groups.

(1)Accessory uses incident to the above permitted use are allowed, but shall not include the conduct of a business or industry on any driveway,walkway or dock giving access thereto.

(2) Domestic employees of the owner, lessee or occupant may be housed in the principal building. No detached or separate employee’s quarters are permitted.

(b)A private garage on the same lot within the building to which it is accessory. Garages shall not be detached from the main residence. All structures must be included in one building. Garage space shall be provided for two motor vehicles on any lot and may be provided for one additional motor vehicle for each 2,500 square feet of lot area by which such lot exceeds 8,000 square feet. Only one commercial vehicle may be kept on any lot or boat slip. No part of any such garage shall be used for residential or business purposes.

(c)Inconspicuousequipment storage sheds, architecturally harmonious with the main building, may be erected on a dock, slip or board walk,subject to specific written approval by the Board.

Section 2.3 Height.

(a) No building, portion of a building, or any attachmentsthereto (i.e. antennas, chimneys, etc) in Single Family ResidentialAreas will exceed 40 feet in height, as measured from the ground level of the graded lot to the highest point of the roof, if the roof pitch isgreater than 2 (two) to 12 (twelve).The cornice line shall notexceed 35 feet in height as that measurement is defined and applied by the city of Destin. Cornice line as used herein means the horizontal line on the exterior of a building at which the roof systemintersects with the exterior wall.

(b) If the roof pitch is less than 2 (two) to 12 (twelve), then the building will not exceed 35 feet in height, as measured from theground level of the graded lot to the highest portion of the roof. The only item allowed above this height would be a guard rail for safety purposes that would not exceed 4 feet in height and must be of open construction with at least 60% open so as not to obstruct sight lines. Dwellings with flat or almost flat roofs can utilize a solid parapet wall for safety purposes so long as the top surface of the wall is less than 35 feet in height as measured from ground elevation.

Section 2.4 Yards. There shall be yards on each side of the building as follows:

(a)Street Side: No building shall be erected, reconstructed or altered so as to project in any manner beyond a setback line which is 25 feet from the County road right-of-way boundary.

(b)Right Side:The minimum distance from the lot lines to the building shall be 15 feet.

(c)Left Side:The minimum distance from the lot lines to the building shall be 15 feet.

(d)Back Yards: The minimum distance from the rear lot line to the building shall be 15 feet. Lots abutting the water are exempt from this provision.

(e) Roof overhangs may extend not more than 4 feet beyond the setback lines. No other portion of a structure may extend beyond the set-back lines, including but not limited to, porches, decks, cantilevers, etc.

Section 2.5 Lot Area. The minimum requirement shall be 8,000 square feet of lot area for each residence.

Section 2.6 Building Size. The enclosed heated and/or cooled residential living area of any building, exclusive of porches, balconies, sundecks and garages, shall be not less than 2,000 squarefeet.

ARTICLE III

MULTI-FAMILY RESIDENTIAL AREA COVENANTS

Section 3.1Classifications.The Multi-Family Residential Area Covenants in this part and the General Covenants in Article IV shall apply to the following Blocks and Lots:

Block C: Lots 15A and 19;

Block E: Lot 96;

Block F: Lots 113 through 124;

Residential Zone 7: Lots 1 through 28;

All other areas zoned by Okaloosa County, Florida or other governmental body as “Residential Intensive Apartment” (“RIA”).

Section 3.2 Uses. Within the Multi-Family Residential Areas, no building, structure or premises shall be used, arranged or designed to be used in any part except as one or more of the following uses:

(a)Duplex Residence Apartment

(b)Triplex Residence Apartment

(c)Townhouses

(d)Apartment Houses

(e)Condominiums

(f)Uses permitted in Single Family Residential Area, ArticleII.

Section 3.3 Accessory Uses. Accessory uses as permitted in Single Family Residential Areas Article II except as follows: Special permission may be granted by the Board for permanent coveredparking to be built in conjunction with apartment houses and condominiums.

Section 3.4 Height. No building shall exceed six stories or amaximum of 75 feet in height, height being measured from the general ground level of the graded lot or parcel. This height limitation does not include antennas, water tanks, ventilators, chimneys, solar panels, TV satellite dishes or other appurtenances usually required to be placed above roof level and not intended for human occupancy.

Section 3.5Yards. There shall be yards on each side of the buildings as follows:

(a)Street Side: No building shall be erected, reconstructed or altered so as to project in any manner beyond a setback line which is 25 feet from the County road right-of-way boundary.

(b)Side Yards:There shall be a right and left side setback of not less than 15 feet from the property line, except that where improvements are built upon contiguous lots owned by one person, the side yard setback shall be applicable only to the outside perimeter or boundaries of said lots in order to permit construction across lot lines.

(c)Back Yards: the minimum distance from the lot line to the building shall be 15 feet. Lots abutting the water are exempt from this provision.

Section 3.6Minimum Living Area. The heated, cooled and enclosed residential living area of multi-family units, exclusive of porches, balconies, sundecks, and garages shall be not less than 700 square feet per unit.

ARTICLE IV

GENERAL COVENANTS AND RESTRICTIONS

Section 4.1 Application. This Article shall apply to both Single Family Residential Areas and Multi-Family Residential Areas.

Section 4.2 Building Permits. No building, structure, or any improvement shall be placed, erected or altered on any lot, property or area on Holiday Isle until a building permit has been obtained from the Board. Issuance of a building permit will be subject to approval of building plans, specifications, and plot plan by the Board. Certificates of compliance must also be supplied pursuant to Section 4.3(c) priorto the issuance of a building permit. Approval will include a review bythe Architectural Review Board (“ARB”) as to the conformity, harmony, and quality of the external structural design. Building permit fees will be as follows: $10.00 up to and including $10,000.00 of building cost, plus $.50 for each additional $1,000.00 of building cost. The fee for a permit must be paid in full prior to its issuance, and the permit must be obtained prior to any construction, site preparation, or demolition. In addition, a refundable damage deposit of $2,000.00must be paid prior to the start of construction. When construction is completed and all requirements as stated in the permit application are satisfied, the construction damage deposit will be refunded.

Section 4.3 Building,Other Improvements, and PermittingRequirements.

(a) No building, fence, wall, walk, driveway, roadway, parking area, pier, dock, seawall, boat slip or other structure shall be commenced or altered until plans and specifications for same have been approved in writing by the Board. Approval will include a review by the ARB as to the conformity, harmony and quality of theimprovement. Plans and specifications must show the nature, kind, shape, height, materials, floor plans, type of foundation, structural design, color scheme, and location of each structure or work to be done and shall include the grading, drainage and landscape plan.

(b) The Board shall have the right to disapprove of any such plans for failure to comply with the provisions of these Covenants or for aesthetic or other reasons.

(c)Lessees/owners are responsible for ensuring that buildings, structures and improvements of every kind erected or maintained and all alterations and additions thereto on Holiday Isle shall conform to the current Southern Standard Building Code. The Board is not responsible for enforcing the rules, regulations or building codes of any level of government; however, certificates of compliance will be required prior to the issuance of a building permit by the Board.

(d)A building permit issued by the Board shall be effective for the period of time stated therein. If construction is commenced within such period, any changes by the Board in its requirements regarding such construction subsequent to the date of the permit shall not apply to said construction without the consent of the holder of the building permit.

(e)No docks or piers shall extend more than six (6) feet beyond the property line into the canals. Docks and piers to be constructed into the Old Pass Lagoon, East Pass Channel or Gulf of Mexico require permits from the City, State and/or Federal agencies, as appropriate. Required permits shall be obtained in all cases and the rules and conditions of the permitting agencies must be adhered to at all times. There shall be no boat repair facilities or fueling facilities on any structure that is located over water. All owners of canal property are responsible for any and all items concerning their property that adversely affect canals, including but not limited to docks in disrepair.

(f)No well shall be sunk without the prior consent of the Board.

(g) Fences or walls shall not be higher than four (4) feet, and must consist of material approved by the Board. This fence height restriction does not apply to fences around tennis courts, in-ground swimming pools or utility equipment such as air conditioning installations. Specificwritten approval by the Board is required prior to the construction of any of the above special-purpose fences.

(h) All buildings built on columns, pilings, or posts shall be covered or enclosed to the first living level. This does not apply to condominiums where the ground level under the building is used for parking or engineering facilities.

(i) No lot may be reduced in area so that the yards and open spaces are smaller than prescribed herein. No yard, court or open space about any building shall be used as a yard, court or open space for any other building.

(j)No individual lot can be subdivided or combined in groups with other lots, even if they otherwise meet all requirements of the Covenants, without special written approval of the Board.

Section 4.4 Reservation of Easements. An easement and right-of-way is hereby expressly reserved by the Association in or under and over a strip five (5) feet in width along rear lines of all lots and left side of every third lot for the erection, construction and maintenance of underground pipes and conduits, poles and wires and clearing of trees and pruning branches, and for the construction, and maintenance of all proper and necessary attachments for electrical lights, power and telephone service and for the construction and maintenance of storm water drains, land drains, sanitary sewers, pipelines for supplying gas and water for the construction and maintenance of any other public or quasi-public utility. The Association shall have the right to enter and to permit others to enter upon said reserved strips of land. This easement and right-of-way shall not apply to portions of said areas to which The Association shall have expressly consented in writing to a conflicting use.

Section 4.5 Health, Sanitation, Cleanliness, and Unsightly Property. In order to keep Holiday Isle a desirable place to live for all owners, the following Covenants are made a part of this Declaration:

(a)Lessees/owners shall be bound by and shall strictly observe all rules and regulations established by the Association, the State Board of Health and any other governmental authority or agency relating to health, sanitation, safety and public welfare.

(b)No sewage, waste, trash, fish cleaning waste or remains,or debris shall be emptied or discharged into any lagoon, lake, body of water, or canal or into the waters of the Old Pass Lagoon or the Gulf of Mexico or any tributaries thereof. This includes swimming pool overflow and emptying.

(c)Each lessee/owner shall keep improvements on his or her property in good repair, properly painted and clean and sanitary at all times; and shall also keep the premises free from all trash, debris,household items, and construction items. No construction materialsshall be stored on any lot unless an active building permit is in place. At such times as the premises are occupied, each lessee/owner shall be responsible for obtaining frequent and regular trash and garbage removal. Each lessee/owner shall keep all surrounding areas, including streets, beaches and neighboring lots, free from trash, debris and obstructions that may be due to the lessee’s use or occupancy of the premises.