ARTICLE II.

Directors

Section 1. Number and Term. The number of directors which shall constitute the whole board shall be not less than three (3) or more than (5). Until succeeded by Directors elected at the first meeting of Members, Directors need not be members of the Association ("Members"); but, thereafter, all Directors shall be Members. Within the limits above specified, the number of Directors shall be determined by the members at the annual meeting. Each Director shall be elected to serve for a term of one (1) year, or until his successor shall be elected and shall qualify. The first Board of Directors shall have (3) Members.

Section 2. Vacancy and Replacement. If the office of any Director or Directors becomes vacant by reason of death, resignation, retirement, disqualification, removal from office or otherwise, a majority of the remaining Directors, though less than a quorum, at a special meeting of Directors duly called for this purpose, shall choose a successor or successors, who shall hold office for the unexpired portion of the term of the vacated office.

Section 3. Removal. Directors, others than those named in Article IX of the Association's Articles of Incorporation ("Articles") may be removed for cause by an affirmative vote of the majority of the qualified votes of members. No Directors other than the original directors named in the Article shall continue to serve on the board if, during his term of office, his membership in the Association shall be terminated for any reason whatsoever.

Section 4. First Board of Directors. The first Board of Directors named in the Articles shall hold office and exercise all powers of the Board of Directors as provided herein.

Section 5. Powers. The property and business of the Association shall be managed by the Board of Directors, which may exercise all corporate powers not specifically prohibited by statute, the Articles or the Declaration. The powers of the Board of Directors shall specifically include, nut not limited to, the following:

 A.To levy and collect regular and special assessments;

 B. To use and expend the Assessments collected to maintain, care for and preserve the Units and Townhome Addition, except those portions thereof which are required to be maintained, cared for and preserved by the Unit Owners;

C. To purchase the necessary equipment required in the maintenance, care and preservation referred to above;

D. To enter into and upon the Units when necessary, with as little inconvenience to the Owners as possible in connection with said maintenance, care and preservation;

E. To insure and keep insured said Townhome Property in the manner set forth in the Declaration, against loss from fire and/or other casualty and the Unit Owners against public liability and to purchase such other insurance as the Board of Directors may deem advisable;

F. To collect delinquent Assessments, by suit or otherwise, abate nuisances and enjoin or seek damages from the Unit Owners for violations of these bylaws and the Declaration;

G. To employ and compensate such personnel as may be required for the maintenance and preservation of the Townhome Property.

H. To make reasonable rules and regulations for the occupancy of the Units and use of the Common Elements;

I. To acquire, rent or lease Units in the name of the Association or a designee;

J. To contract for management of the Townhome Addition and to delegate to such other party all powers and duties of the Association except those specifically required by the Declaration to have the specific approval of the Board of Directors or membership.

Section 6. Compensation. Neither Directors nor Officers shall receive compensation for their services as such.

Section 7. Meetings.

A. The first meeting of each Board newly elected by the Members shall be held immediately upon adjournment of the meeting at which they were elected provided a quorum shall then be present, or as soon thereafter as may be practicable. The annual meeting of the Board of Directors shall be held at the same place as the Members' meeting, and immediately after the adjournment of same.

B. Special meetings shall be held whenever called by the President or a majority of the board. The Secretary shall give notice of each special meeting, either personally, by mail or telegram, at least three (3) days before the date of the meeting, but the Directors may waive notice of the calling of the meeting.

C. A majority of the Board shall be necessary at all meetings to constitute a quorum for the transaction of business, and the act of a majority present at any meeting at which there is a quorum shall be the act of the board. If a quorum shall not be present at the meeting, the Directors then present may adjourn the meeting until a quorum shall be present.

Section 8. Order of Business. The order of business at all meetings of the Board shall be as follows:

A. Roll call;
B. Reading of the Minutes of the last meeting;
C. Consideration of communications;
D. Resignations and elections;
E. Reports of officers and employees;
F. Reports of committees;
G. Unfinished business;
H. Original resolutions and new business;
I. Adjournment

Section 9. Annual Statement. The Board shall present, no less often than at each annual meeting a full and clear statement of the business and condition of the Association including a report of the operating expenses of the Association and the Assessments paid by each Member.

ARTICLE III.

Officers

Section 1. Executive Officers. The executive officers of the Association shall be a President, Vice-President, Treasurer and Secretary, all of whom shall be elected annually by said Board. Any two of the said offices may be united in one person, except that the President shall not also be the Secretary or an assistant Secretary of the Corporation. If the Board so determines, there may be more than one Vice-President.

Section 2. Subordinate Officers. The Board of Directors may appoint such other officers and agents as they may deem necessary, who shall hold office during the pleasure of the Board of Directors and have such authority and perform such duties as from time to time may be prescribed by said Board.

Section 3. Tenure of Officers; Removal. All officers and agents shall be subject to removal, with or without cause, at any time by action of the Board of Directors, which may delegate such powers to any officer.

Section 4. The President.

A. If present, the President shall be Chairman and shall preside at all meetings of the Members and Directors; he shall have general and active management of the business of the corporation except that which is delegated; shall see that all orders and resolutions of the Board are carried into effect; and shall execute bonds, mortgages and other contracts requiring a seal of the corporation. The seal, when affixed, shall be attested by the signature of the Secretary.

B. He shall have general superintendence and direction of all the other offices of the corporation, and shall see that their duties are performed properly.

C. He shall submit a report of the operations of the corporation for the fiscal year to the Directors (whenever called for by them) and to the members at the annual meeting, and from time to time shall report to the Board all matters within his knowledge which the best interests of the corporation may require be brought to their notice.

D. He shall be an ex officio member of all committees, and shall have the general powers and duties of supervision and management usually vested in the office of the President of a corporation.

Section 5. The Vice-President. The Vice-President shall be vested with all the powers and required to perform all the duties of the President in his absence, together with such other duties as may be prescribed by the Board of Directors.

Section 6. The Secretary.

A. The Secretary shall keep the minutes of the meetings of the members and of the Board of Directors in one or more books provided for that purpose.

B. He shall see that all notices are duly given in accordance with the provisions of these By-Laws or as required by law.

C. He shall be custodian of the corporate records of the seal of the corporation and shall see that the seal of the corporation is affixed to all documents, the execution of which on behalf of the corporation under its seal is duly authorized in accordance with the provisions of these By-Laws.

Section 7. The Treasurer.

A. The Treasurer shall keep full and accurate accounts of receipts and disbursements in books belonging to the Association and shall deposit all monies and other valuable effects in the name and to the credit of the Association in such depositories as may be designated by the Board of Directors.

B. He shall disburse the funds of the Association as ordered by the Board, taking proper vouchers for such disbursement, and shall render to the President and Directors, at the regular meeting of the Board, or whenever they may require it, an account of all his transactions as Treasurer and of the financial condition of the Association.

C. He may be required to give the Association a bond in a sum and with one or more sureties satisfactory to the Board for the faithful performance of the duties of his office, and the restoration to the Association in case of his death, resignation or removal from office, of all books, papers, vouchers, money or other property of whatever kind in his possession belonging to the Association.

Section 8. Vacancies. If the office of the President, Vice-President, Secretary or Treasurer becomes vacant by reason of death, resignation, disqualification or otherwise, the Directors, by majority vote of the Board of Directors, may choose a successor or successors who shall hold office for the unexpired portion of the terms of the vacated office.

Section 9. Resignations. Any Director or other officer may resign his office at any time, in writing, which resignation shall take effect from the time of its receipt by the Association, unless some later time be fixed in the resignation, and then from that date. The acceptance of the resignation shall be required to make it effective.

ARTICLE IV.

Membership

Section 1. Definition. Each Unit Owner (including a corporate owner) shall be a member of the Association and membership in the Association shall be limited to Unit Owners.

Section 2. Transfer of Membership and Ownership. Membership in the Association may be transferred only as an incident to the transfer of the transferor's Unit. Such transfer shall be subject to the procedures set forth in the Declaration.

ARTICLE V.

Meetings of Membership

Section 1. Place. All meetings of the Association membership shall be held at such place as may be stated in the notice of the meeting.

Section 2. Annual Meeting.

A. The first annual meeting of Members shall be held at such time as the first election of Directors is to be held as provided in the Declaration. In addition to the election of the Directors as said first meeting, such other business as may properly come before the meeting may be transacted.

B. Regular annual meetings subsequent to the first meeting shall be held on the first weekday of the month in which said first meeting was held, if not a legal holiday, and if a legal holiday, then on the next secular day following.

C. All annual meetings shall be held at the hour of 7:00 o'clock P.M.

D. At the annual meeting, the Members, by a plurality vote (cumulative voting prohibited) shall elect a Board of Directors and transact such other business as may properly come before the meeting.

E. Written notice of the annual meeting shall be served upon or mailed to each Member entitled to vote at such address appears on the books of the Association, at least ten (10) days prior to the meeting.

Section 3. Membership List. At least ten (10) days before every election of directors, a complete list of Members entitled to vote at said election, arranged numerically by Units, with the residence of each Member, shall be prepared by the Secretary. Such list shall be produced and kept for said ten (10) days and throughout the election at the office of the Association, and shall be open to examination by any Member through such time.

Section 4. Special Meetings.

A. Special meetings of the Members, for any purpose or purposes, unless otherwise prescribed by the Articles or statute, may be called by the President, and shall be called by the President or Secretary at the request, in writing, or one-third (1/3) of the Members. Such request shall state the purpose or purposes of the proposed meeting.

B. Written notice of a special meeting of the Members stating the time, place and object thereof, shall be served upon or mailed to each member entitled to vote thereon, at such address as appears on the books of the Corporation at least five (5) days before such meeting.

C. Business transacted at all special meetings shall be confined to the objects stated in the notice thereof.

Section 5. Quorum. Fifty-One (51%) percent of the total number of members of the Association, present in person or represented by written proxy, shall be requisite to and shall constitute a quorum at all meetings of the Members for the transaction of business, except as otherwise provided by statute, the Articles or these By-Laws. If, however, such quorum shall not be present or represented at any meeting of the Members, the Members, the Members entitled to vote thereat, present in person or represented by written proxy, shall have the power to adjourn the meeting, until a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting originally called.

Section 6. Vote required to Transact Business. When a quorum is present at any meeting, a majority of the votes cast, in person or represented by written proxy, shall decide any questions brought before the meeting, unless the question is one which, by express provision of the Texas Statutes, the Declaration, the Articles or these By-Laws, requires a different vote, in which case such express provision shall govern and control the decision of such question.

Section 7. Right to Vote. Unit owners shall be entitled to one (1) vote per Unit. At any meeting of the members. every Member having the right to vote shall be entitled to vote in person or by proxy. Such proxy shall only be valid for such meeting or subsequent adjourned meetings thereon. Proxies must be filed with the Secretary of the Association at or before the appointed time of each meeting of the Members of the Association. If a Unit is owned by more than one Owner (individual or corporate), said Owners shall file a certificate with the secretary naming the person authorized to cast said Unit's vote. If same is not on file, the vote of such Unit shall not be considered, nor shall the presence of said Owners at a meeting be considered in determining whether the quorum requirement has been met.

Section 8. Waiver and Consent. Whenever the vote of Members at a meeting is required or permitted by any provision of the Texas Statutes, the Declaration, the Articles or these By-Laws in connection with any action of the Association, the meeting and vote of the Members may be dispensed with if all Members who would have been entitled to vote upon the action of such meeting if such meeting were held shall consent in writing to such action being taken

Section 9. Order of Business. The order of business at annual Members' meeting will be:

A. Election of Chairman;
B. Roll call;
C. Proof of Notice of Meeting or Waiver of Notice;
D. Reading of Minutes of Prior Meeting;
E. Officer's Reports;
F. Committees Reports;
G. Elections;
H. Unfinished Business;
I. New Business;
J. Adjournment.

ARTICLE VI.

Notices

Section 1. Definition. Whenever under the provisions of the Texas Statutes, the Declaration, the Articles or these By-Laws, notice is required to be given to any Director or Member, it shall not be construed to mean personal notice, but such notice may be given in writing by mail, by depositing the same in a post office or letter box in a postpaid, sealed envelope, addressed as appears on the books of the corporation.

Section 2. Service of Notice-Waiver. Whenever any notice is required to be given under the provisions of the Texas Statutes, the Declaration, the Articles or these By-Laws, a waiver thereof, in writing signed by the person or persons entitled to such notice, whether before or after time stated therein, shall be deemed to be the equivalent thereof.

Section 3. Address. The address of notice to the Association is the address of the registered agent as filed in the office of Secretary of State.

ARTICLE VII.

Finances

Section 1. Fiscal Year. The fiscal year shall be the calendar year.

Section 2. Checks. All checks or demands for money and notes of the Association shall be signed by any one of the following officers: President, Vice-President, Secretary or Treasurer, or by such officer or officers or such other person or persons as the Board of Directors may from time to time designate. The Board of Directors by resolution may require more than one (1) signature.

Section 3. Determination of Assessments.

A. The Board of Directors shall fix Assessments adequate to meet the Common Expenses of the Townhome Addition. Common Expenses shall include expenses for the operation, maintenance, repair or replacement of the Common Elements, costs of carrying out the powers and duties of the Association, all insurance premiums and expenses thereto, including fire insurance and any other expenses designated as Common Expenses from time to time by the Board of Directors. The Board of Directors is specifically empowered on behalf of the Association to make and collect Assessments, and to maintain, repair and replace Common Elements of the Townhome Addition. Funds for the payment of Common Expenses shall be assessed against the Unit Owners in the proportions of percentages of sharing Common Expenses provided in the Declaration. Special Assessments which may be required by the Board of Directors, shall be levied and paid in the same manner as herein before provided for regular Assessments.

B. When the Board of Directors has determined the amount of any Assessment, the Secretary or Treasurer shall mail or present a statement of the Assessment to each of the Unit Owners. All Assessments shall be payable to the Association, and upon request, the Secretary or Treasurer shall give a receipt for each payment made.

C. Notwithstanding anything in these By-Laws, the Articles or the Declaration which authorize expenditures, after the first election of the Directors, at a meeting called pursuant to the Declaration and these By-Laws, no expenditures for the improvement of the Common elements exceeding $3,000.00 per annum shall be made without the approval of Sixty-Six and two-thirds percent (66-2/3%) of the membership, except for the repair of the Townhome Property due to casualty loss.

Section 4. Accounting and Audit. The Association shall keep detailed books of account showing all expenditures and receipts of the administration of the Townhome Addition which shall specify the maintenance and repair expenses incurred by or on behalf of the Association. Such books shall be open for inspection by the Unit Owners during reasonable working hours on weekdays and shall be audited annually by qualified auditors. The cost of such audit shall be an expense of administration of the Townhome Addition. Any holder of a mortgage shall have the same right of inspection as the Unit Owners.

ARTICLE VIII.

Rules and Regulations

Section 1. In addition to the other provisions of these By-Laws, the following Rules and Regulations, together with such additional Rules and Regulations as may hereafter be adopted by the Board of Directors, shall govern the use of Units and the conduct of all residents thereof:

A. Units shall be used only for residential purposes;

B. Unit Owners shall not use or permit the use of their premises in any manner which would be disturbing or be a nuisance to other owners, or in such way be injurious to the reputation of the Townhome. No Unit Owner shall do or permit anything to be done or keep or permit to be kept in his Unit or on the Common Elements anything that will increase the rate of insurance on the Townhome Addition. No Owner shall store any dangerous explosive or inflammable liquids or other materials either in his unit or upon the Common Elements.

C. The use of the Townhome Addition shall be consistent with existing law and the Declaration to which these By-Laws become a part.

D. Common Elements shall not be obstructed, littered, defaced or misused in any manner.

E. No structural changes or alterations shall be made in any Unit without prior written consent of the Board of Directors and any mortgagee holding a mortgage on said Unit.

F. A Unit Owner shall not cause or permit anything to be hung or displayed on the outside of windows or placed on the outside of walls of his Unit, and no sign, awning, shutter or antenna shall be affixed to or placed on the exterior walls or roof, or any part thereof, without the prior consent of the Association.

G. No outdoor clothes lines may be erected and nothing shall be hung or exposed on any part of the Common Elements.

H. Common walks, park areas and other Common Elements shall be kept free from rubbish, debris or other unsightly materials, and shall not be obstructed, littered, defaced or misused in any manner.

I. No "For Sale" or "For Rent" signs larger than 18" x 24" or other window displays or advertising shall be permitted on any part of the Townhome addition or in any unit except that the Association submitting said Property to Townhome use and any Mortgagee who may become the owner of a Unit shall have the right to exhibit such signs.

J. No animal shall be kept except household pets. Such pets may not be kept or bred for any commercial purpose and shall have such care and restraint so as not to be obnoxious or offensive on account of noise, odor or unsanitary conditions. No savage or dangerous animal shall be kept. No pets may be permitted to run loose upon the Common Elements.

K. None of the restrictions contained in this Article shall apply to the commercial activities or signs or billboards, if any, of the Developer during the sales period of the Townhome Addition, or of the Association in furtherance of it's powers and purposes set forth herein and in its Articles of Incorporation and By-Laws as the same may be amended from time to time.

ARTICLE IX.

Default

Section 1. In the event a Unit Owner does not pay any sum, charge or Assessment required to be paid to the association within ten (10) days from the due date, the Association, acting on it's own behalf or through its Board of Directors, may enforce its lien for Assessments or take such other action to recover the sum, charge or Assessment to which it is entitled in accordance with the Declaration and the laws of the State of Texas, however, the holder of such mortgage shall be notified of any default.

Section 2. If the Association becomes the owner of a Unit by reason of foreclosure, it shall offer said Unit for sale and at such a time as a sale is consummated, it shall deduct from the proceeds of said sale all sums of money due it for Assessments and charges, all costs incurred in the bringing of the foreclosure suit, including reasonable attorney's fees and any and all expenses incurred in the resale of the Unit, which shall include, but not be limited to, advertising expenses, real estate brokerage fees and expenses necessary for the repairing and refurbishing of the Unit. All monies remaining after deducting the foregoing items of expense shall be returned to the former owner of the Unit.

Section 3. In the event of a violation of the provisions of the Declaration, the Articles or By-Laws, which which violation is not corrected in thirty (30) days after notice from the Association to the Units Owner to correct said violation, the Association may take such action as it may deem appropriate, including the institution of legal action, to correct the violation.

Section 4. In the event such legal action is brought against a Unit Owner and results in a Judgment for the Plaintiff, the Defendant shall pay the Plaintiff's reasonable attorney's fees and court costs.

Section 5. Each Unit Owner, for himself, his heirs, successors and assigns, agrees to the foregoing provisions regardless of the harshness of the remedy available to the Association and regardless of the availability of the other equally adequate procedures. It is the intent of all Unit Owners to give to the Association such powers and authority which will enable it to operate on a businesslike basis, to collect those monies due and owing it from the Unit Owners, and to preserve each Unit Owner's right to enjoy his Unit free from unreasonable restraint and nuisance.

ARTICLE X.

Joint Ownership

Section 1. Membership may be held in the name of more than one person or corporation. In the event ownership is in more than one person or corporation all of the joint owners shall be entitled collectively to only one vote in the management of the affairs of the Association and said vote may not be divided between multiple owners.

ARTICLE XI.

Amendment

Section 1. These By-Laws may be amended at any duly called meeting of the Members. The notice of the meeting shall contain a full statement of the proposed amendment, and the quorum requirement for such purposes shall be a majority of all members. It shall be necessary that there be an affirmative vote of seventy-five (75%) percent of all the members and seventy-five (75%) percent of the Board of Directors to amend these By-Laws. No amendment to these By-Laws shall be passed which would operate to impair or prejudice the rights of liabilities of any mortgagee.

ARTICLE XII.

Mortgages

Section 1. Notice to Association. Any Unit Owner who mortgages his Unit shall notify the Association of the name and address of the mortgagee, and the association shall maintain such information in a book entitled "Mortgages of Townhome Unit". The Association may, at the written request of a mortgagee of any such unit, report any unpaid assessments due from the Unit Owner of such Unit.

Section 2. Notice to Mortgagees. The Association shall notify each mortgagee appearing in the book described in Section 1 of this Article XII of the name of each company insuring the Townhome Addition under the Master Policy and the amounts of the coverage thereunder.

ARTICLE XIII.

Construction

Section 1. Whenever the masculine singular form of the pronoun is used in these By-Laws, it shall be construed to include the masculine, feminine or neuter, singular or plural, whenever the context so requires.

Section 2. Should any of the covenants herein imposed be void or be or become unenforceable at law or in equity. the remaining provisions of this instrument shall, nevertheless, be and remain in full force and effect. In the event the Declaration, By-Laws or Articles of Incorporation conflict with the provisions of the Act, then the Act shall govern. In the event these By-Laws shall be inconsistent with the Declaration, then the Declaration shall be controlling.

ARTICLE XIV.

Severability

Section 1. In the event that any of the terms, provisions or covenants of these By-Laws are held to be partially or wholly invalid or unenforceable for any reason whatsoever such holding shall not affect, alter, modify or impair in any manner whatsoever any of the other terms, provisions or covenants hereof or the remaining portions of any terms, provisions or covenants held to be partially valid or enforceable.

ARTICLE XV.

In the event that any of the terms, provisions or covenants of these By-Laws are in conflict with the provisions of the Declaration of Covenants, Conditions and Restrictions for the Establishment of 4102 Bowser Townhomes addition, then in such event, the provisions of the Declaration shall prevail.