BYLAWS

OF

GREENBRIAR NEIGHBORHOOD CORPORATION

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ARTICLE I

ARTICLE II

ARTICLE Ill Section 1. Section 2. Section 3. Section 4. Section 5. Section 6.

ARTICLE IV Section 1. Section 2. Section 3. Section 4. Section 5. Section 6. Section 7. Section 8. Section 9. Section 10.

ARTICLE V Section 1. Section 2. Section 3. Section 4. Section 5. Section 6. Section 7. Section 8. Section 9. Section 10. Section 11. Section 12. Section 13. Section 14. Section 15.

BYLAWS

OF

GREENBRIAR NEIGHBORHOOD CO PORATION

TABLE OF CONTENTS

DEFINITIONS . . . . . . . . . . . .. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ....... 1

PRINCIPAL OFFICE........................... ..................................... . ....... 2

MEMBERS............................................................................. . ....... 3 Membership........................................................................... . ....... 3 Termination of Membership ..................................................... . ....... 3 Voting Rights......................................................................... . ....... 3 Plural Memberships................................................................. . ....... 3 Assessments . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . .. . . . . . . . . . ....... 3 Neighborhood Corporation Rules; Fine ; Enforcement . . . . . .. . . . . . . . . . . . . ........ 3

MEETINGS OF MEMBERS................. . . . . . .. . . . . . . . . . . . . .. . . . . . . . . . . . . .. . . . . ........ 5 Place of Meetings............................ . . . . . . . . . . . . . . . . . . . . . . .. . . . . .. . . . . . . . . . ........ 5 Annual Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........ 5 Special Meetings............................. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........ 5 Notice of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........ 5 Quorum ........................................................................................ 5 Proxies ......................................................................................... 6 Form of Proxies............................... ..................................... . ........ 6 Action Without Meeting......................................................... . ........ 6 Joint Association .. . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . ........ 6 Minutes............................................................................... . ........ 6

BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... 8 Number ......................................................................................... 8 Qualifications for Holding Office . . . . . . . .. . . . . . . .. . . . . . . . . . . . . . . . . . . .. . . . . .. . . . ......... 8 Election ........................................................................................ 8 Nomination of Directors . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . ......... 8 Election Procedures . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . ......... 8 Removal........................................ ...................................... . ........ 9 Vacancies ..................................... ..................................... . ......... 9 Regular Meetings . . . . . . . . .. . . .. . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... 9 Special Meetings.................................................................. . ......... 9 Quorum.............................................................................. . ....... 10 Attendance of Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . ....... 10 Adjournment of Meetings . .. . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . ........ 10 Action Without Meeting . . . . . . . . . . . .. . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. .. . . . .. . ........ 1 0 Indemnification of Directors, Officers and Employees................. . ........ 10 Records ....................................................................................... 11

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TABLE OF CONTENTS (con .)

ARTICLE VI POWERS AND DUTIES OF DIRECTORS . .. . . .. . . . . . .. . . . .. .. .. . ... .. . .. . . . . .. . .... 1 2

ARTICLE VII Section 1. Section 2. Section 3. Section 4. Section 5. Section 6. Section 7. Section 8.

ARTICLE VIII Section 1. Section 2. Section 3. Section 4. Section 5. Section 6. Section 7. Section 8.

ARTICLE IX Section 1. Section 2. Section 3. Section 4.

ARTICLE X Section 1. Section 2. Section 3.

ARTICLE XI

OFFICERS AND THEIR DUTIES .......... . Enumeration of Officers .................... . Election of Officers ......................... . Term ............................................ . Special Appointments ..................... . Resignation and Removal ................. . Vacancies ..................................... . Multiple Offices .............................. . Duties ............................•...............

MISCELLANEOUS ........................... . Record Owner ................................ . Checks, Drafts, etc ........................ .. Contracts, How Executed ................ . Inspection of Bylaws ....................... . Technology ................................... . Singular Includes Plural ................... . Conflicts ...................................... . Conflicts with LARMAC Bylaws ....... .

BOOKS AND RECORDS .................. . Inspection Rights of Members ......... . Rules for Inspection ....................... . Rights of Directors ......................... . Delivery to Neighborhood Corporation

AMENDMENTS ............................. . Powers of Members ....................... . Record of Amendments ................. .. FHA and VA Approval .................... .

CORPORATE SEAL ....................... .

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BYLAWS

I

. OF I

GREENBRIAR NEIGHBORHOOD CORrORATION

ARTICLE I

DEFINITIONS

All terms as used in these Bylaws shall, unless tated otherwise, be set forth in that certain Declaration of Covenants, Conditions and estrictions for Greenbriar Neighborhood Corporation rec9rded as Instrument No. 20010746759, of Official Records County, California (the "Neighborhood Declaration") and any a endments thereto. All of and provisions of the Neighborhood Declaration and any amen ments thereto are hereby

incorporated herein by reference.

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ARTICLE II

PRINCIPAL OFFICE

The principal office for the transaction of the b siness of the Neighborhood Corporation is hereby fixed and located within the County of Orange, State of California. he Board is hereby granted full power and authority to change said princ pal office from one location to

another within said Orange County.

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ARTICLE Ill

MEMBERS

Section 1 . Membership. Every person or ntity who is an Owner of a Unit shall be a Member of the Neighborhood Corporation as provided in the Neighborhood Declarati n. Membership shall be appurtenant to and may not be separate from ownership in any Uni which gives rise to such membership in the Neighborhood Corporati n. Ownership of such a Un t or interest therein shall be the sole qualification for membership. Transfer of a Unit shall aut matically transfer membership in the Neighborhood Corporation and all rights of the transferor with respect to the Neighborhood Corporation Property. The provisions of th se Bylaws which are bindin upon all Members, are not exclusive, and Members shall also be subje t to the terms and provisio s of the Neighborhood Declaration, the Articles and Neighborhood Co poration Rules.

Section 2. Termination of Membership. embership in the Neighbor Corporation shall automatically terminate when such Member sells and transfers his Cond

Section 3. Voting Rights. The Neighborh od Corporation shall have t e classes of voting membership as set forth in the Neighborhood Decla ation. Class A Members sh II be all Owners with the exception of Neighborhood Builder (until th termination of the Class B membership). Each Class A Member shall be entitled to one 1) vote for each Unit owne . The Class B Member shall be the Neighborhood Builder. The Class B Member shall be entitled to three (3) votes for each Unit owned. The Class B membership sha I terminate at the times as p ovided in the Neighborhood Declaration.

Section 4. Plural Memberships. A Memb r may not own more than ne membership in the Neighborhood Corporation but a Member hall have the votes for each Unit owned as set forth in the Neighborhood Declaration.

Section 5. Assessments. The Members hall be jointly, severally and personally liable for the payment of such assessments as may from tim to time be fixed and levied by the Board pursuant to the provisions of the Neighborhood Declar tion. Should any Member f ii to pay his assessments before delinquency, the Neighborhood Corp ration, at the discretion oft e Board, shall have the right to suspend the voting rights and easeme ts of use and enjoyment of he Neighborhood Corporation Property by such Member, subjec to the procedural safeguar s established under Section 6 of this Article, for any period du ing which the payment of a y such Member's assessments remains delinquent.

Section 6. Nei hborhood Cor oration Ru es; Fines; Enforcement. Th Board shall have the power to adopt, amend, and repeal such rules and regulations as it deems reasonable, which may include the establishment of a system of fines a d penalties enforceable as a Reimbursement Assessment pursuant to the Neighborhood eclaration. Any such discip inary action by the Board shall satisfy the minimum requirements f Section 7341 of the Corp rations Code before a decision to impose disciplinary action is reach d with respect to the accu d Member. If the Neighborhood Corporation has adopted a po icy imposing a monetary pe alty or fine on any Member for a violation of the Neighborhood Declarat on or Neighborhood Corpora ion Rules, including any monetary penalty relating to the activities of a guest or invitee of a Memb , the Board shall adopt and distribute to each Member, by personal delivlery or first-class mail, a sch dule of the monetary penalties that may be assessed for those violations, which shall be in accorda ce with authorization for Member discipline contained in the Neighbdrhood Declaration. The Boa d shall not be required to distribute any additional schedules of monetaty penalties unless there are hanges from the schedule that was adopted and distributed to the Members pursuant to this pr ision. The

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Board of the Neighborhood Corporation shall meet in executive session if requested by the ember being disciplined, and the Member shall be entitled to attend t e executive session. In addi ion, said Neighborhood Corporation Rules shall provide that no fine or p nalty shall be levied withou the

following procedural safeguards:

(a) A written statement of the alle ed violations shall be provid

Member against whom such charges are made and such writt n statement shall provide a

which the charges shall be heard;

(b) No proceedings under this Section shall be brought against

Member unless such Member shall have received a written sta ement of charges at least t

days prior to that hearing;

(c) No proceeding shall be brought against any Member more t an sixty

(60) days after such Member is provided a written statement f charges;

(d) The Board shall appoint a pane of three (3) capable person (one of

whom shall be designated a chairman) who may or may not b Members and who shall h ar the

charges and evaluate the evidence of the alleged violation;

(el At such hearing the Member s charged shall have the righ to

present oral and written evidence and to confront and cross-examine adverse witnesses;

(f) The panel shall deliver to the ember so charged within s en {7)

days after the hearing a written decision which specifies the ines or penalties levied, if a

reasons therefor; and

{g) In the event that a Member s all correct an alleged violati

the hearing date, the Board shall discontinue the proceedings

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ARTICLE IV

MEETINGS OF MEMBE S

Section 1 . Place of Meetings. All meetin s of Members shall be held at the Project or as close thereto as possible, or at such other plac in the County of Orange as may be fixed from time to time by resolution of the Board. Unless u usual conditions exist, mee ings of Members shall not be held outside of Orange County.

Section 2. Annual Meetings. The first a nual meeting of the Membe s shall be held in Orange County within six (6) months after the sale of the first Unit in the Project uthorized for sale under the authority of a Final Subdivision Public Rep rt, and each subsequent re ular annual meeting of the Members shall be held on the same month of each year thereafter, at sue reasonable hour as may be established by the Board, in Oran e County, provided, howev r, that the Board by resolution may fix a date for the meeting no more t an thirty (30) days before rafter said date. If the day for the annual meeting of the Members is a egal holiday, the meeting w·11 be held at the same hour on the first day following which is not a le al holiday. Control of the P oject shall be turned over to the Neighborhood Corporation at the first nnual meeting. Meetings of the membership of the Neighborhood Corporation shall be condu ted in accordance with a re ognized system of parliamentary procedure or such parliamentary pr cedures as the Neighborhoo Corporation may adopt.

Section 3. Special Meetings. Special m etings of the Members shall be promptly called by the Board upon either (i) the vote of the oard or, (ii) written request herefor signed by Members representing at least five percent (5%) o the total voting power oft e Neighborhood Corporation.

Section 4. Notice of Meetings. Written otice of meetings, annual o special, shall be given to each Member entitled to vote, either perso ally or by sending a copy of the notice through first class mail, postage prepaid, to his address app aring on the books of the N ighborhood Corporation, or supplied by him to the Neighborhood Corpor tion for the purpose of noti e. All such notices shall be sent to each Member entitled thereto not le s than ten ( 10) days nor mo e than sixty (60) days before each meeting, and shall specify the pl ce, the day and the hour of such meeting, and the general nature of the business to be transa ted at such meeting, and t e notice shall also specify those matters which the Board intends to resent for action by the Me hers. Notwithstanding the foregoing, except as otherwise provide by law, any proper matter ay be presented at the meeting for action. Any approval of the M mbers required under Secti ns 7222, 7224, 7233, 7812 or 8719 of the California Corporations C de, other than unanimous pproval by those entitled to vote, shall be valid only if the general natu e of the proposal so approv d was stated in the notice of the meeting. When any meeting of embers, either annual or sp cial, is adjourned for thirty (30) days or more, notice of the time an place of the adjourned me ting shall be given as in the case of an original meeting. Except as af resaid, it shall not be neces ary to give any notice of an adjournment or of the business to be trans cted at an adjourned meetin other than by announcement thereof at the meeting at which sue adjournment is taken.

Section 5. Quorum. Except as provided in the Neighborhood Oeclar tion pertaining to quorum requirements for increases in assessm nts, the presence at the me ting of Members of the Neighborhood Corporation entitled to cast, pr of proxies entitled to cast fifty percent (50%) of the total voting power shall constitute a quorum for any action except as otherwise provided in the Articles, the Neighborhood Declaration or these Bylaws. If an meeting cannot be held because a quorum is not present, a majority of the Members present, eit er in person or by proxy, may adjourn the meeting to a time not less than five (5) days norm re than

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thirty (30) days from the time the original meeting was called. The quorum for an adjourn d meeting shall be twenty-five percent (25%) of the total voting power of the Neighborhood Corporation. If a time and place for the adjourned meeting is ot fixed by those in attenda ce at the original meeting, or if for any reason a new date is fixed f r the adjourned meeting aft r adjournment, notice of the time and place of the adjourned m eting shall be given in the m prescribed for all meetings, annual or special. Unless notice o the adjourned meeting is gi pursuant to these Bylaws, the only matters that may be voted on at the adjourned meetin those matters included in the notice for the original meeting. xcept where a greater porti voting power is required by the Articles, the Neighborhood De laration, or these Bylaws a ajority of the voting power present, in person or by proxy, shall prev ii at all meetings.

Section 6. Proxies. Every Member entitle to vote or execute consent shall have the right to do so either in person, or by an agent or age ts authorized by a written p oxy executed by such Member or his duly authorized agent and fil d with the Secretary of the Neighborhood Corporation. A validly executed proxy that doe not state that it is irrevoca le shall continue in full force and effect unless (i) revoked by the Me ber executing it prior to the ote pursuant thereto, or (ii} written notice of the death or incapaci y of the maker of the proxy is received by the Neighborhood Corporation before the vote pur uant thereto is counted; pr vided, however, that no proxy shall be valid after the expiration of el ven (11} months from the ate of the proxy, unless otherwise provided in the proxy, except that th maximum term of any prox shall not exceed three (3) years from the date of execution. Anything o the contrary notwithstand ng, any revocable proxy covering matters requiring a vote of the Mem ers pursuant to Sections 7 22, 7224, 7233, 7613(f)(1 ), 7812, 7911 (a)(2), 8012, 8015(a), 8610 or 8719(a) of the Califo nia Corporations Code is not valid as to such matters unless it se s forth the general nature of the matter to be voted on.

Section 7. Form of Proxies. Any form of roxy or written ballot distri any person to the membership of the Neighborhood Corporati n shall afford the opportuni to specify a choice between approval and disapproval of each m tter or group of matters to upon, except it shall not be mandatory that a candidate for el ction to the Board be name in the proxy or written ballot. The proxy or written ballot shall provide that, where the Member pecifies a choice, the vote shall be cast in accordance with that choice. The proxy shall also identif the person or persons authorized to exercise the proxy and the le gth of time it will be valid.

Section 8. Action Without Meeting. Any ction which may be taken y the vote of the Members at a regular or special meeting, except t e election of members of th Board where cumulative voting is a requirement, may be taken with ut a meeting if done in com liance with the provisions of Section 7 51 3 of the Corporations Cod

Section 9. Joint Association. Whenever wo or more associations ha e consolidated any of their functions under a joint neighborhoo association or similar organ zation, members of each participating association shall be entitled to attend all meetings of the jo nt association, other than executive sessions, shall be given rea onable opportunity for parti ipation in those meetings, and shall be entitled to the same access to t e joint association's records as they are to the participating association's record.

Section 10. Minutes. The minutes, minut s proposed for adoption tha are marked to indicate draft status, or a summary of the minutes of any meeting of the Board, other than an executive session, shall be available to Members wit in thirty (30) days of the m eting. The minutes, proposed minutes, or summary of the minutes $hall be distributed to any M mber of the Neighborhood Corporation upon request and upon reimbu~sement of the Neighborhoo Corporation's costs in making that distribution. Members of the Neighborhood Corporati n shall be notified in writing at the time that the pro forma budget, required in Section 1 365 of the alifornia Civil Code, is distributed, or at the time of any general mailing to the entire membership or the

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Neighborhood Corporation of their right to have copies of the how and where those minutes may be obtained.

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ARTICLE V

BOARD OF DIRECTOR

Section 1. Number. The affairs of the Ne ghborhood Corporation shall be managed by a Board of three (3) directors, until such number f directors is changed by a y-law duly adopted by the Members amending this Section.

Section 2. Qualifications for Holdin the following requirements while serving in office.

(a) Not be absent from three (3) c nsecutive meetings of the oard;

(bl Attend at least seventy-five p rcent (75%) of the Board m etings held each year and attend the entire meeting each time;

{c) Exhibit respect, professionalis and courteous behavior to Owners, committee members, vendors, the Manger and its staff, and ny other persons associated with or retained by the Neighborhood Corporation; an

{d) For non-Neighborhood Builder oard members, be an Own r in good standing.

Section 3. Election. At the first annual eeting of the Neighborhood Corporation, the Members shall elect a total of three director , two directors to serve for term of two years, and one director to serve for a term of one year. he two directors receiving he highest number of votes shall be elected for a two-year term, and th director receiving the next ighest number of votes shall be elected for a one-year term. There fter, at each annual meeting of the Neighborhood Corporation, the Members shall elect directors to fill the vacancies of those directors whose terms then expire, and the term of each such director so elected shall be two year .

Section 4. Nomination of Directors. No inations for the office of a ember of the Board of Directors shall be made by a Nominating Cammi tee consisting of a chairma , who shall be a member of the Board of Directors, and two (2) or ore Members of the Neighb rhood Corporation, all of whom shall be appointed by the Board of irectors prior to each annua meeting of the Members, to serve from the close of such annual mee ing until the close of the ne t annual meeting. The Nominating Committee shall make as many no inations for election to the Board of Directors as it shall in its discretion determine, but not less t an the number of vacancies that are to be filled. Nominations may also be made by Members from he floor at the annual meeti g or such other meeting at which members of the Board of Directors a e to be elected. Such nomi ations may be made from among Members or non-Members.

Section 5. Election Procedures. Election to the Board of Directors sh II be by secret written ballot. At such election the Members or their proxies may cast, in respect to each vacancy, as many votes as they are entitled to exercise und r the provisions of the Neig borhood Declaration. The person receiving the largest number of vot s shall be elected. Cumulat ve voting is required in all elections for the Board of Directors in which more than two positions ar to be filled subject only to the procedural prerequisites to cumulative voting prescribed in Section 7 15(b) of the Corporations Code. Notwithstanding anything to the corhtrary contained in these Byl ws, at least twenty percent (20%) of the Board but not less than ohe (1) Member shall be selec ed solely by the votes of Members other than the Neighborhood Builder at any election so long as a majority

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of the voting power of the Neighborhood Corporation resides in the Neighborhood Builder, or so long as there are two outstanding classes of membership in the N ighborhood Corporation.

Section 6. Removal. Any director may b removed from the Board, without cause, by a majority vote of the Members of the Nei hborhood Corporation. Ho unless the entire Board is removed from office by the vote of Members of the Neighborho Corporation, an individual director shall not be removed prior o the expiration of his term f office if the number of votes cast against removal would be sufficient to elect the director if vote cumulatively at an election at which the same number of vot s were cast and the entire umber of directors authorized at the time of the most recent election o directors were then being e ected. Provided, however, that any member of the Board of Directors who has been elected to o fice solely by the votes of Members of the Neighborhood Corporation ot er than the Neighborhood uilder pursuant to Section 4 of this Article, may be removed from o fice prior to the expiration o his term of office only by the vote of a simple majority of the voting p wer residing in Members at er than the Neighborhood Builder. In the event of death or resignatio of a director, his successo shall be elected by the remaining members of the Board and shall ser e for the unexpired term of predecessor; provided, however, in the event of death or resi nation of a director elected the Members other than Neighborhood Builder pursuant to Se tion 4 of this Article, such may be replaced solely by Members other than Neighborhood Builder under the same proc the event of removal of a director, his successor shall be elec ed by the Members of the Neighborhood Corporation.

Section 7. Vacancies. Vacancies on the oard, except vacancies arisi g from removal of a director, may be filled by a vote of a majority of the remaining directors, tho gh less than a quorum, and each director so elected shall hold office ntil his successor is elected at an annual meeting of Members, or at a special meeting called fo that purpose. A vacancy o vacancies shall be deemed to exist in case of the death, resig ation or removal of any dire tor. If the Members shall increase the authorized number of director but shall fail to elect the a ditional directors as provided for at the meeting at which such increa e is authorized, or at an adj thereof, or in case the Members fail to at any time elect the f II number of the authorized irectors, a vacancy or vacancies shall be deemed to exist. The Memb rs may at any time elect dir ctors to fill any vacancy not filled by the directors, and may elect the dditional directors at the m eting at which an amendment of the Bylaws is voted authorizing an in rease in the number of dire tors. If any director tenders his resignation to the Board, the Board s all have the power to elect successor to take office at such time as the resignation shall ecome effective. No reduc ion of the number of directors shall have the effect of removing any dir ctor prior to the expiration o his term of office.

Section 8. Regular Meetings. Regular me tings of the Board of Direct rs shall be held monthly at such place and hour within the Property a may be fixed from time to ime by resolution of the Board. However, such meetings may be co ducted as infrequently as ev ry six (6) months if the business to be transacted by the Board of Direc ors does not justify more fr quent meetings. Notice of the time and place of each meeting shall be posted at a prominent pl ce or places within the Neighborhood Corporation Property and sha I be communicated to Board members not less than four (4) days prior to the meeting; provided, ho ever, that notice of a meeti g need not be given to any Board member who has signed a waiver f notice or written consent t the holding of the meeting. If the Neighborhood Corporation Pro erty consists only of an eas ment or is otherwise unsuitable for posting of such notice, the Board sh II communicate the notice o the time and place of such meeting by any means it deems appropriate.

Section 9. Special Meetings. Special meetings of the Board of Direct rs may be called by written notice signed by the President of the Neighbbrhood Corporation, or by a y two (2) directors other than the President, after not less than seventy~two (72) hours notice to ea h director. The notice shall specify the time and place of the meeting and the nature of any special

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business to be considered. The notice shall be sent to all mem ers of the Board of Directo sand posted in a manner prescribed for notice of regular meetings n t less than seventy-two (72 hours prior to the scheduled time of the meeting; provided however t at notice of the meeting ne d not be given to any Board member who signed a waiver of notice or a written consent to holding f the meeting.

Section 1 0. Quorum. A majority of the nu ber of directors as fixed by he Articles or these Bylaws shall be necessary to constitute a quorum for the transaction of b siness, except to adjourn as hereinafter provided. Every act or decisi n made or done by a majorit of the directors present at a meeting duly held at which a quorum is resent shall be regarded as he act of the Board.

Section 11. Attendance of Meetings. Regu ar and special meetings oft of Directors shall be open to all Members of the Neighborhood Corporation. The Board of irectors shall permit any Member of the Neighborhood Corporation to peak at any meeting of the Neighborhood Corporation or the Board, except for meetings of the Board held in executiv A reasonable time limit for all Members of the Neighborhood orporation to speak to the B before a meeting of the Neighborhood Corporation shall be established by the Board. Notwithstanding the foregoing, any Member of the Neighborh ad Corporation may attend eetings of the Board of Directors, except when the Board adjourns to xecutive session to conside litigation, matters that relate to the formation of contracts wit third parties, or personnel atters. Any matter discussed in executive session shall be generally oted in the minutes of the B ard. In any matter relating to the discipline of a Neighborhood Corpor tion Member, the Board sh fl meet in executive session if requested by that Member, and the Mem er shall be entitled to atten the executive session.

Section 12. Adjournment of Meetings. Th Board of Directors may, wi h the approval of a majority of its members present at a meeting in which a quorum for the tran action of business has been established, adjourn a meeting and reconv ne in executive session to d scuss and vote upon personnel matters, litigation in which the Neighbor ood Corporation is or may ecome involved and orders of business of a similar nature. The natu e of any and all business to e considered in executive session shall first be announced in op n session.

Section 13. Action Without Meeting. Any action which may be taken Board of Directors at a regular or special meeting may be tak n without a meeting if all of the Board members consent in writing to the action to be taken. If the oard of Directors resolves y unanimous written consent to take action, an explanation of he action taken shall be pos ed at a prominent place or places within the Neighborhood Corporati n Property within three day after the written consents have been obtained for all Board members. f the Neighborhood Corpora ion Property consists only of an easement or is otherwise unsuit ble for posting the explanati n of the action taken, the governing body shalt communicate said ex lanation by any means it de appropriate. This explanation shall be given in the manner p escribed herein for the givin of regular meetings of the Board of Directors.

Section 14. Indemnification of Directors, fficers and Em lo ees. Th Neighborhood Corporation may, to the maximum extent per itted by Section 7237 of th Corporations Code, reimburse, indemnify and hold harmless ach present and future dire tor, officer and employee of the Neighborhood Corporation and each pe son who, at the request of Neighborhood Corporation acts as a director, officer or empl yee of any other corporatio the Neighborhood Corporation has an interest, from and aga~nst all loss, cost, liability an which may be imposed upon or reasonably incurred by him, 'ncluding reasonable settlem payments, in connection with any claim, action, suit or proc~eding or threat thereof, ma e or instituted, in which he may be involved or be made a party l:i>y reason of his being or hav ng been a director, officer or employee of the Neighborhood Corporation or such other corporation,! or by

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reason of any action alleged to have been taken or omitted y him in such capacity. The right of indemnification provided in this Section shall inure to each p rson referred to in this Sect on, whether or not the claim asserted against him is based on m tters which arose in whole r in part prior to the adoption of this Section and in the event of his eath shall extend to his lega

representatives.

Section 15. Records. The Board shall ca se to be kept a complete re ord of all its acts and corporate affairs and to present a statement thereof to the Members at ann al meetings of Members or at any special meeting where such statemen is requested in writing by o e-fourth

{ 1 /4) of the Members entitled to vote thereat.

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ARTICLE Vl

POWERS AND DUTIES OF DIR

In addition to the powers and duties of the Bo rd as set forth in the Neigh orhood Declaration and the Articles, and subject to limitations of the rticles, the Neighborhood Declaration, or these Bylaws and of the California Corporation Code as to actions to be a thorized or approved by the Members, and subject to the duties of the directors as prescribed by t Bylaws, all corporate powers shall be exercised by or under t e authority of, and the busi affairs of the Neighborhood Corporation shall be controlled by the Board. Without prejudi e to such general powers, but subject to the same limitations, the Boar is vested with and shall ha e the following powers; to wit:

(a) to select, appoint and remove II officers, agents and empl yees of the Neighborhood Corporation, toprescribe such powers and uties for them as may be c .nsistent with law, the Articles, the Neighborhood Declaration and/or t ese Bylaws.

(b) to conduct, manage and contr I the affairs and business o the Neighborhood Corporation, and to enforce such rules and reg lations therefor consistent ith law, with the Articles, the Neighborhood Declaration and/or these ylaws, as the Board may d em necessary or advisable.

(c) to fix, determine and name from time to time, if necessary or advisable, the nonprofit corporation, city or public agency which is then or there organize or operated for purposes similar to the purposes of this Neighbo hood Corporation to which he assets of this Neighborhood Corporation shall be distributed upon liq idation or dissolution accor ing to the Articles. The assets so distributed shall be those remaining a ter satisfaction of all just d bts and obligations of the Neighborhood Corporation under the terms of a specific trust or trusts.

(d) to maintain the Project and th Neighborhood Corporation roperty therein in accordance with the terms, covenants and conditions of the Neighborhood Dec aration, but subject to the limitations on the power of the Board as s ecifically set forth in the Ne ghborhood Declaration.

(e) to enter into agreement with ny nonprofit corporation or ocal Governmental agencies;

{f} to enter into contracts in whi h Neighborhood Corporatio enters into litigation or any alternative dispute resolution procedure hen Neighborhood Corpor ion's obligation to pay for services is set in whole or in part on a c ntingency basis except (i} ontracts for collection of assessments or other accounts receivable, (i ) contracts involving evalua ion of services, or (iii) contracts with a total amount to be paid by eighborhood Corporation n t in excess of Forty Thousand Dollars ($40,000.00).

In the event of any conflict between this Article and any other provision of the Neighborhood Corporation Management Documents, the pro isions of this Article shall c ntrol.

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ARTICLE VII

OFFICERS AND THEIR D TIES

Section 1 . · Enumeration of Officers. Th officers of the Neighborho d Corporation shall be a President and Vice-President, who sh II at all times be members f the Board of Directors, a Secretary and a Chief Financial Officer, and uch other officers as the Bo rd may from time to time by resolution establish.

Section 2. Election of Officers. The ele tion of officers shall take pl ce at the first meeting of the Board of Directors following each annu I meeting of the Members.

Section 3. Term. The officers of the N ighborhood Corporation sha I be elected annually by the Board and each shall hold office for one ( 1) year unless he shall sooner esign, or shall be removed, or otherwise be disqualified to serve.

Section 4. Special Appointments. The oard may elect such other fficers as the affairs of the Neighborhood Corporation may require, e ch of whom shall hold offic for such period, have such authority, and perform such duties as th Board may, from time to ti e, determine.

Section 5. Resignation and Removal. ny officer may be removed rom office with or without cause by the Board. Any officer may resig at any time by giving writt n notice to the Board, and President or the Secretary. Such resignatio shall take effect on the dat of receipt of such notice or at any later time specified therein, and un ess otherwise specified the in, the acceptance of such resignation shall not be necessary to m ke it effective.

Section 6. Vacancies. A vacancy in an office may be filled in the prescribed for regular: election. The officer elected to such vacancy shall serve for the the term of any officer he replaces.

Section 7. Multiple Offices. The office of Secretary and Chief Fin ncial Officer may be held by the same person. No person shall simultan ously hold more than one the other offices except in the case of special offices created pursua t to Section 4 of this Articl

Section 8. Duties. The duties of the o ficers shall be as follows:

(a) President. The President s all preside at all meetings of the Board of Directors and at all meetings of the Members; shall implem nt the orders and resolutio s of the Board; shall sign all leases, mortgages, deeds and other w itten instruments and shall s gn all promissory notes of the Neighborhood Corporation. The P esident is also the Neighbor ood Representative (as such term is defined in the LARMAC D claration) for the Neighborh od. The President shall have the powers and duties of the Neighbo hood Representative as pre cribed by the LARMAC Board, the LARMAC Bylaws and the Master Dec aration.

(b} Vice-President. The Vice-P esident shall act in the plac and stead of the President in the event of his absence, inability or refus I to act, and shall exercise nd discharge such other duties as may be required of him by the Board. i The Vice-President shall al o act as the alternate Neighborhood Representative for the Neighborhobd. The Vice President shall have the powers and duties of an alternative Neighborhood Represelntative as prescribed by the LARMAC Board, the LARMAC Bylaws and the Master Declaration.

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(c) Secretary. The Secretary shall r cord the votes and keep th minutes of all meetings and proceedings of the Board and of th Members; serve notice of eetings of the Board and of its Members; keep the corporate seal of th Neighborhood Corporation nd affix it to all papers requiring such seal; keep, or cause to be kept, a propriate current records s owing the Members of the Neighborhood Corporation, together with t eir addresses; and shall per orm

such other duties as may be required by the Board.

(d) Chief Financial Officer. The Chi f Financial Officer shall rec ive and deposit in appropriate bank accounts all monies of the Neighbo hood Corporation and shall isburse such funds as directed by resolution of the Board of Directors; shall sign all promissory not s of the Neighborhood Corporation; and shall keep proper books of ace unt.

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ARTICLE VIII

MISCELLANEOUS

Section 1. Record Owner. The record 0 ner of each Unit as of the ate of any annual or special meeting of the Members shall be entitled t vote at any such meeting, ubject to the provisions of the Section of the Neighborhood Declarati n entitled "Vesting of Votin Rights" of the Article entitled "MEMBERSHIP AND VOTING RIGHTS."

Section 2. Checks, Drafts, etc. All che ks, drafts, or other orders f r payment of money, notes or other evidences of indebtedness, issued in the name of or payable t the Neighborhood Corporation, shall be signed or endorsed by s ch officer or officers or oth r person or persons and in such manner, from time to time, as shall be etermined by resolution of e Board.

Section 3. Contracts, How Executed. he Board, except as in thes otherwise provided, may authorize any officer or officers, a ent or agents, to enter into contract or execute any instrument in the name of and on b half of the Neighborhood C and such authority may be general or confined to specific i stances; and unless so auth Board, no officer, agent or employee shall have any power r authority to bind the Neig Corporation by any contract or engagement or to pledge its credit or to render it liable f r any purpose or for any amount. The Board shall not enter into ny contracts for goods or s rvices with a duration greater than one year without the vote or writte consent of a majority of th total voting power of the Neighborhood Corporation, which shall includ a majority of votes residing in Members other than the Neighborhood Builder, with the following ex eptions: (i) a management ontract, the terms of which have been approved by the Federal Housing Administration or the Depa ment of Veterans Affairs; (ii) a contract with a public utility compan if the rates charged for th materials or services are regulated by the Public Utilities Commission; p ovided, however, that the t rm of the contract shall not exceed the shortest term for which the s pplier will contract at the r gulated rate; (iii) prepaid casualty and/or liability insurance policies of no to exceed three years' dura ion, provided that the policy permits for short rate cancellation y the insured; (iv) a lease a reement for laundry room fixtures and equipment of not to exceed five ears duration provided that the lessor under the agreement is not an entity in which Neighborhoo Builder has a direct or indi ct ownership interest of ten percent ( 10%) or more; (v) agree equipment, satellite dish services and equipment, communi ation services and equipme t, high speed data transfer, computer services, telephone and co parable technology, service and equipment with terms not in excess of five (5) years, provi ed that Neighborhood Build r does not have a direct or indirect ownership interest in the supplier f such services or equipme t equal or greater than ten percent ( 10%); (vi) agreements for sale or lease of burglar alarm and f re alarm equipment, installation and services of not to exceed five ears duration provided that he supplier or suppliers are not entities in which Neighborhood Builder has a direct or indirect own rship interest of ten percent ( 10%) or more; or (vii) a contract for a term not to exceed three years t at is terminable by the Neighborhood Corporation after no long r than one year without cau e, penalty or other obligation upon ninety days written notice of termin tion to the other party. An agreement for professional management of the Neighborhood Corpor tion or for services of the N ighborhood Builder must provide that the management contract may b terminated by either party without cause or payment of a termination fee upon ninety days o less written notice and the erm of such contract shall not exceed one year.

Section 4. Inspection of Bylaws. The ;Neighborhood Corporation s all keep in its principal office for the transaction of business the original 1or a copy of the Bylaws as mended, certified by the Secretary, which shall be open to inspectipn by all of the Members at II reasonable times.

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Section 5. Technology. Where allowed b applicable law, the Neighb rhood Corporation, its Board of Directors, officers, or other represen atives may distribute inform tion by any system or technology designed to record and communica e messages, facsimile, elect onic mail,

or other electronic means.

Section 6. Singular Includes Plural. Wher ver the context of these Byl ws requires same, the singular shall include the plural, and the m sculine shall include the fe

Section 7. Conflicts. In the case of any c

Incorporation and these Bylaws, the Articles shall control; an Neighborhood Declaration and the Bylaws, the Neighborhood

nflict between the Articles in the case of a conflict bet een the eclaration shall control.

Section 8. Conflicts with LARMAC B law . In the case of any conflic between these Bylaws and the LARMAC Governing Documents, the L RMAC Governing Documen s shall

control.

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ARTICLE IX

BOOKS AND RECOR S

Section 1 . . Members of the Neighbor ood Corporation shall have access to Neighborhood Corporation ecords in accordance with rticle 3 (commencing with Section 8330) of Chapter 13 of Part 3 o Division 2 of Title 1 of the Corporations Code. The membership register, including mai ing addresses and telephon numbers, books of account, records, papers, minutes of Member's m etings and Board of Directo ' meetings and of committees of the Board of Directors of the Neighbo hood Corporation shall at all times, during reasonable business hours, be subject to inspection y any Member, insurer, gua antor of a First Mortgage, and the lender of any Owner of a Unit, at a y reasonable time and for a purpose reasonably related to their interest as a Member, at the offi e of the Neighborhood Corp ration or at such other place within the Property as the Board shall pres ribe.

Section 2. Rules for Inspection. The B ard of Directors shall establi h reasonable rules with respect to the following:

(a) Notice to be given to the cu todian of the records by the Member of the Neighborhood Corporation desiring to make the inspecti n;

(b) Hours and days of the week when such an inspection m y be made;

(c) Payment of the cost of repr ducing copies of document requested by a Member of the Neighborhood Corporation.

Section 3. Rights of Directors. Every d rector shall have the absolu e right at any reasonable time to inspect all books, records and docu ents of the Neighborhood orporation and the physical properties owned or controlled by the Nei hborhood Corporation. The right of inspection by a director includes the right to make extracts and copies of documents.

Section 4. Deliver to Nei hborhood C r oration. Not later than ni ety days after the close of escrow for the sale of the first Unit withi the Properties, Neighborho d Builder shall deliver to the Board of the Neighborhood Corporation at the office of the Neighbo cod Corporation, or at such other place as the Board shall pres ribe, those documents spec tied in Section 2792.23(a) of the Regulations of the Real Estate ommissioner contained in Ti le 10 of the California Administrative Code, as amended or revised. T e obligation to deliver the d cuments specified in Section 2792.23(a) shall apply to any docume ts obtained by Neighborhoo Builder no matter when obtained; provided, however, such obligation shall terminate upon the ear ier of (a) the conveyance of the last Unit covered by a Subdivision Publi Report, or (b) three years fter the expiration of the most recent Public Report on the Project. In the event that the Projec is phased, the Neighborhood Builder shall deliver, as soon as readily btainable, but not later than ninety days after the annexation of additional phases to the Project, th se documents prescribed b Section 2792.23(a) of the Regulations of the Real Estate Commis ioner, as amended or revise .

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ARTICLE X

AMENDMENTS

Section 1. Powers of Members. The Byl ws may be adopted, amend d or repealed only by the vote or written assent of both (i) Memb rs entitled to exercise a maj rity of the voting power of the Neighborhood Corporation, and (ii) a majority of the total possible vo es of Members other than Neighborhood Builder; provided, howev r, that the percentage of vo ing power necessary to amend a specific clause or provision shall not b less than the percentage o affirmative votes prescribed for action to be taken under tha clause. Notwithstanding t foregoing, if the two-class voting structure is still in effect, t ese Bylaws may not be am without the vote or written assent of a majority of the votin power of each class of me

Section 2. Record of Amendments. Wh never an amendment or ne Bylaw is adopted it shall be placed in the book of Bylaws in the appro riate place. If any Bylaw is repealed, the fact of repeal, with the date of the meeting at which the repeal was enacted or writt n assent

was filed, shall be stated in said book.

Section 3. FHA and VA Approval. As lo g as there is a Class B me bership, any amendment to these Bylaws shall require the prior appr val of the Department of Ve erans Affairs and the Federal Housing Administration. A draft of a y Amendment to these Byl ws shall be submitted to the VA for its approval prior to its approval y the membership of the N ighborhood

Corporation.

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ARTICLE XI

CORPORATE SEAL

The Neighborhood Corporation shall have a s al in circular form having its

circumference the words:

GREENBRIAR NEIGHBORHOOD C RPORATION

INCORPORATED

SEPTEMBER 25, 200

California

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CERTIFICATION

I, the undersigned, do hereby certify:

That I am the duly elected and acting Secreta y of Greenbriar Neighborho Corporation, a California nonprofit mutual benefit corporation

That the foregoing Bylaws constitute the origi al Bylaws of said Neighbor ood Corporation, as duly adopted at a meeting of the Board of Dir ctors thereof held on the 2nd day of November , 2001.

IN WITNESS WHEREOF, I have hereunto subs ribed my name and affixed he seal of said Neighborhood Corporation this 2nd day of Novemb r , 2001.

I r '- : -Secretary

[SEAL]