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Montgomery Oaks Homeowners Association, Inc. · 30 pages
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DOC #2024010016 Pages 71 AFTER RECORDING RETURN TO: ROBERT D. BURTON, ESQ.

MARK D. GROBMYER, ESQ.

WINSTEAD PC 401 CONGRESS AVE., SUITE 2100 AUSTIN, TEXAS 78701 EMAIL: [email protected] [email protected] Declarant: AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS FOR MONTGOMERY OAKS MONTGOMERY COUNTY, TEXAS MERITAGE HOMES OF TEXAS, LLC, an Arizona limited liability company This Amended and Restated Declaration of Covenants, Conditions and Restrictions may be used only in connection with the residential community known as Montgomery Oaks in Montgomery County, Texas and the operation of Montgomery Oaks Homeowners Association, Inc., a Texas nonprofit corporation.

THIS INSTRUMENT AMENDS, RESTATES, AND REPLACES IN ITS ENTIRETY THAT CERTAIN MONTGOMERY OAKS DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS, RECORDED AS DOCUMENT NO. 2021048610, OFFICIAL PUBLIC RECORDS OF MONTGOMERY COUNTY, TEXAS.

4892-4621-0975v.3 51928-142 ARTICLE 1 DEFINITIONS.

2.1 General.....

2.2 Compliance with Applicable Law 2.3 Conceptual Plans.......

2.4 2.5 2.6 Rentals TABLE OF CONTENTS Page 1 ARTICLE 2 GENERAL AND USE RESTRICTIONS.

6 6 7 7 Single-Family Residential Use Provision of Benefits and Services to Service Areas...

7 8 9 2.7 Subdividing...

2.8 Hazardous Activities.

2.9 Insurance Rates......

9 2.10 Mining and Drilling.

9 2.11 Noise 10 2.12 Animals Household Pets.

10 2.13 Rubbish and Debris 10 2.14 Trash Containers 10 2.15 Maintenance...

10 2.16 2.17 Street Landscape Area-Owner's Obligation to Maintain Landscaping.

Antennas..

11 11 2.18 Location of Permitted Antennas 12 2.19 Signs 12 2.20 Flags Approval Requirements..

13 2.21 Flags - Installation and Display.

13 2.22 Tanks.....

14 2.23 Temporary Structures...

14 2.24 Outside Storage Buildings.

14 2.25

Pages 2–3

ted Antennas 12 2.19 Signs 12 2.20 Flags Approval Requirements..

13 2.21 Flags - Installation and Display.

13 2.22 Tanks.....

14 2.23 Temporary Structures...

14 2.24 Outside Storage Buildings.

14 2.25 Unsightly Articles; Vehicles....

14 2.26 Parking 14 2.27 Mobile Homes, Travel Trailers and Recreational Vehicles 15 2.28 Basketball Goals; Permanent and Portable....

15 2.29 Compliance with Restrictions 15 2.30 Liability of Owners for Damage to Common Area or Special Common Area 15 2.31 Release 16 2.32 No Warranty of Enforceability.

16 2.33 Party Wall...

16 2.34 Common Retaining Walls..

17 2.35 Playscapes and Sport Courts.

18 2.36 Decorations and Lighting.

18 2.37 Water Quality Facilities, Drainage Facilities and Drainage Ponds.

18 2.38 Release and Indemnity ...

18 4892-4621-0975v.3 51928-142 i 2.39 Model Home ..

2.40 Removal of Soil and Trees ARTICLE 3 CONSTRUCTION RESTRICTIONS.

Approval for Construction.

19 19 19 4.2 3.1 3.2 Fences; Sidewalks.....

3.3 Drainage.

3.4 Construction Activities...

3.5 Roofing 3.6 3.7 3.8 3.9 3.10 3.11 Swimming Pools.......

Compliance with Setbacks.

Solar Energy Device.............

Rainwater Harvesting Systems.

Xeriscaping....

Garages...

ARTICLE 4 Montgomery Oaks Homeowners Association, Inc.

4.1 Organization Membership..

19 19 19 4.3 Governance 4.4 Voting Rights..

4.5 Powers 4.6 4.7 4.8 Conveyance of Common Area and Special Common Area to the Association Indemnification.

Insurance 4.9 Bulk Rate Contracts 222222222222222288 4.10 Community Systems.........

30 4.11 Protection of Declarant's Interests 30 4.12 Administration of Common Area and the Special Common Area.

.31 4.13 Maintenance Provided by Association.

31 4.14 4.15 Merger..

Right of Action by Association....

31 31 ARTICLE 5 INSURANCE.

32 5.1 Insurance.

5.2 Restoration 32 32 6.1 6.2 6.3

Pages 3–4

ecial Common Area.

.31 4.13 Maintenance Provided by Association.

31 4.14 4.15 Merger..

Right of Action by Association....

31 31 ARTICLE 5 INSURANCE.

32 5.1 Insurance.

5.2 Restoration 32 32 6.1 6.2 6.3 Regular Assessments.

6.4 Special Assessments....

5.3 Mechanic's and Materialmen's Lien ARTICLE 6 COVENANT FOR ASSESSMENTS.

Assessments.

Maintenance Fund 33 33 33 33 33 34 6.6 6.7 6.5 Special Common Area Assessments Service Area Assessments...

34 34 Individual Assessments 35 4892-4621-0975v.3 51928-142 ii 6.8 6.9 6.10 Late Charges 6.11 Working Capital Assessment Amount of Assessment Owner's Personal Obligation; Interest 6.12 Assessment Lien and Foreclosure...

6.13 Exempt Property 6.14 Fines and Damages Assessment.

9.1 9.2 9.3 9.4 9.5 9.6 ARTICLE 7 ARCHITECTURAL CONTROL COMMITTEE.

7.1 Construction of Improvements..

7.2 Architectural Control Committee..

ARTICLE 8 MORTGAGE PROVISIONS.

8.1 8.2 8.3 Notice of Action..........

Examination of Books.........

Taxes, Assessments and Charges..

ARTICLE 9 GENERAL PROVISIONS Term Eminent Domain Amendment Enforcement Declarant Fine Authority.

Higher Authority 42 42 42 42 42 43 22222 7 7 7 7 7 7 7 7 7 35 .36 36 36 36 38 38 .39 39 39 41 41 44 44 44 9.7 Severability.

44 9.8 9.9 Gender 9.10 9.11 Conflicts.....

Acceptance by Owners.

Damage and Destruction 44 44 45 45 9.12 No Partition.......

46 9.13 Notices 46 9.14 View Impairment.

46 9.15 Safety and Security 46 ARTICLE 10 EASEMENTS.

47 10.1 Right of Ingress and Egress 47 10.2 Reserved Easements 47 10.3 Improvements, Roadway and Utility Easements.

.48 10.4 Subdivision Entry and Fencing Easement...

48 10.5 Landscape and Monument Sign Easement.

48 10.6 Easement to Inspect and Right to Correct.

48 ARTICLE 11 DEVELOPMENT RIGHTS...

Development by Declarant.

49 11.1 11.2 11.3

Pages 4–6

and Fencing Easement...

48 10.5 Landscape and Monument Sign Easement.

48 10.6 Easement to Inspect and Right to Correct.

48 ARTICLE 11 DEVELOPMENT RIGHTS...

Development by Declarant.

49 11.1 11.2 11.3 Special Declarant Rights….………………………….

Addition of Land..

49 49 .49 4892-4621-0975v.3 51928-142 iii 12.1 Withdrawal of Land..

11.4 11.5 Notice of Plat Recordation..

11.6 Assignment of Declarant's Rights.

ARTICLE 12 DISPUTE RESOLUTION.

Introduction and Definitions..

12.2 Mandatory Procedures.

.51 12.3 Claim Affecting Common Areas...

12.4 Claim by Lot Owners - Improvements on Lots......

.51 50 .50 50 50 Ggggg 51 55 12.5 Notice.

57 12.6 Negotiation 57 12.7 Mediation .57 12.8 Binding Arbitration-Claims.

12.9 Allocation of Costs...

12.10 General Provisions.

12.11 Period of Limitation....

12.12 Funding the Resolution of Claims.

59 .59 59 .60 12.13 Waiver of Rights Under Certain Statutory Provisions .60 58 iv 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS FOR MONTGOMERY OAKS This Amended and Restated Declaration of Covenants, Conditions and Restrictions for Montgomery Oaks (the "Declaration") is made by MERITAGE HOMES OF TEXAS, LLC, an Arizona limited liability company ("Declarant"), and is as follows: RECITALS: A. Declarant previously executed and recorded that certain Declaration of Covenants, Conditions and Restrictions for Montgomery Oaks, recorded as Document No. 2021048610, Official Public Records of Montgomery County, Texas (the "Original Declaration").

B.

Pursuant to Section 12.2 of the Original Declaration, the Original Declaration may be amended by the Declarant acting alone during the Development Period. The Development Period has not expired.

C.

B.

Pursuant to Section 12.2 of the Original Declaration, the Original Declaration may be amended by the Declarant acting alone during the Development Period. The Development Period has not expired.

C.

The Declarant wishes to amend and restate the Original Declaration. Thus, this Declaration amends, restates, and replaces the Original Declaration in its entirety.

D.

This Declaration is filed with respect to that certain real property located in Montgomery County, Texas, as more particularly described on Exhibit "A" attached hereto and incorporated herein for all purposes (the "Property"). Declarant is the owner of the Property.

E. Declarant desires to create and carry out a uniform plan for the development, improvement, and sale of the Property.

F. By the Recording of this Declaration, Declarant serves notice that the Property is subject to the terms and provisions of this Declaration.

NOW, THEREFORE, it is hereby declared: (i) that the Property (or any portion thereof) will be held sold, conveyed, and occupied subject to the following covenants, conditions and restrictions which will run with such portions of the Property and will be binding upon all parties having right, title, or interest in or to such portions of the Property or any part thereof, their heirs, successors, and assigns and will inure to the benefit of each owner thereof; and (ii) that each contract or deed conveying the Property (or any portion thereof) will conclusively be held to have been executed, delivered, and accepted subject to the following covenants, conditions and restrictions, regardless of whether or not the same are set out in full or by reference in said contract or deed.

This Declaration uses notes (text set apart in boxes) to illustrate concepts and assist the reader. If

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gardless of whether or not the same are set out in full or by reference in said contract or deed.

This Declaration uses notes (text set apart in boxes) to illustrate concepts and assist the reader. If there is a conflict between any note and the text of this Declaration, the text will control.

ARTICLE 1 DEFINITIONS Unless the context otherwise specifies or requires, the following words and phrases when used in this Declaration will have the meanings hereinafter specified: 1 AMENDED AND RESTATED 4892-4621-0975v.3 51928-142 DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS "Applicable Law" means all statutes, public laws, ordinances, policies, rules, regulations and orders of all federal, state, county and municipal governments or their agencies having jurisdiction and control over the Property in effect at the time a provision of the Restrictions is applied, and pertaining to the subject matter of the Restriction provision, and all other ordinances, and any other applicable building codes, zoning restrictions and permits or other applicable regulations. Statutes and ordinances specifically referenced in the Restrictions are "Applicable Law" on the date the Restrictions are Recorded, and are not intended to apply to the Property if they cease to be applicable by operation of law, or if they are replaced or superseded by one or more other statutes or ordinances.

"Architectural Control Committee" or "ACC" means the committee created pursuant to this Declaration to review and approve or deny plans for the construction, placement, modification, alteration or remodeling of any Improvements on a Lot. As provided in Article 7 below, Declarant acts as the ACC

tion to review and approve or deny plans for the construction, placement, modification, alteration or remodeling of any Improvements on a Lot. As provided in Article 7 below, Declarant acts as the ACC and the ACC is not a committee of the Association until Declarant has assigned its right to appoint and remove all ACC members to the Association in a Recorded written instrument.

"Assessment" or "Assessments" means all assessments imposed by the Association under this Declaration.

"Assessment Unit" has the meaning set forth in Section 6.9.2.

"Association" means Montgomery Oaks Homeowners Association, Inc., a Texas nonprofit corporation, which will be created by Declarant to exercise the authority and assume the powers specified in Article 4 and elsewhere in this Declaration. The failure of the Association to maintain its corporate charter from time to time does not affect the existence or legitimacy of the Association, which derives its authority from this Declaration, the Certificate, the Bylaws, and Applicable Law.

"Board" means the Board of Directors of the Association.

"Bulk Rate Contract" or "Bulk Rate Contracts" means one or more contracts which are entered into by the Association for the provision of utility services or other services of any kind or nature to the Lots.

The services provided under Bulk Rate Contracts may include, without limitation, cable television services, telecommunications services, internet access services, "broadband" services, security services, trash pickup services, propane service, natural gas service, lawn maintenance services, wastewater services, and any other services of any kind or nature which are considered by the Board to be beneficial to all or a portion

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ropane service, natural gas service, lawn maintenance services, wastewater services, and any other services of any kind or nature which are considered by the Board to be beneficial to all or a portion of the Property. Each Bulk Rate Contract must be approved in advance and in writing by Declarant until expiration or termination of the Development Period.

"Bylaws" means the bylaws of the Association, which may be initially adopted and Recorded by Declarant or the Board of the Association and Recorded as part of the initial project documentation for the benefit of the Association. The Bylaws may be amended, from time to time, by Declarant until expiration or termination of the Development Period. Any amendment to the Bylaws proposed by the Board must be approved in advance and in writing by Declarant until expiration or termination of the Development Period. Upon expiration of the Development Period, the Bylaws may be amended by a Majority of the Board.

"Certificate" means the Certificate of Formation of the Association, filed in the Office of the Secretary of State of Texas, as the same may be amended from time to time.

"City" means the City of Conroe, Texas.

2 AMENDED AND RESTATED 4892-4621-0975v.3 51928-142 DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS "Common Area" means any property and facilities that the Association owns or in which it otherwise holds rights or obligations, including any property or facilities held by Declarant for the benefit of the Association or its Members. Common Area also includes any property that the Association holds under a lease, license, or any easement in favor of the Association. Some Common Area will be solely for

e Association or its Members. Common Area also includes any property that the Association holds under a lease, license, or any easement in favor of the Association. Some Common Area will be solely for the common use and enjoyment of the Owners, Residents, and their guests, tenants and invitees, while other portions of the Common Area may be for the use and enjoyment of the Owners, Residents, and their guests, tenants and invitees, and members of the public.

"Community Manual" means the community manual of the Association, which may be initially adopted and Recorded by Declarant or the Board of the Association and Recorded as part of the initial project documentation for the benefit of the Association and the Property. The Community Manual may include the Bylaws, Rules and Regulations and other policies governing the Association. The Bylaws, Rules and Regulations and other policies set forth in the Community Manual may be amended or supplemented, from time to time, by Declarant until expiration or termination of the Development Period. Any amendment to the Bylaws, Rules and Regulations and other policies governing the Association prosecuted by the Board must be approved in advance and in writing by Declarant until expiration or termination of the Development Period. Upon expiration or termination of the Development Period, the Community Manual may be amended or supplemented by a Majority of the Board.

"Community Systems" means any and all cable television, telecommunications, alarm/monitoring, internet, telephone or other lines, conduits, wires, amplifiers, towers, antennas, satellite dishes, equipment, materials and installations and fixtures (including those based on, containing and serving future

telephone or other lines, conduits, wires, amplifiers, towers, antennas, satellite dishes, equipment, materials and installations and fixtures (including those based on, containing and serving future technological advances not now known), if installed by Declarant pursuant to any grant of easement or authority by Declarant within the Property.

"County" means the County of Montgomery, Texas.

"Declarant" means MERITAGE HOMES OF TEXAS, LLC, an Arizona limited liability company, its successors or assigns; provided that any assignment(s) of the rights of MERITAGE HOMES OF TEXAS, LLC, an Arizona limited liability company, as Declarant, must be expressly set forth in writing and Recorded.

Declarant enjoys special rights and privileges to help protect its investment in the Property. These special rights are described in this Declaration. Many of these rights do not terminate until either Declarant: (i) has conveyed all Lots which may be created out of the Property; or (ii) voluntarily terminates these rights by a Recorded written instrument.

"Design Guidelines" means the standards for design, construction, landscaping, and exterior items proposed to be placed on any Lot adopted pursuant to Section 7.2.3, as the same may be amended from time to time. The Design Guidelines may consist of multiple written design guidelines applying to specific portions of the Property. At Declarant's option, Declarant may adopt or amend from time to time the Design Guidelines for the Property or any portion thereof. Notwithstanding anything in this Declaration to the contrary, Declarant will have no obligation to establish Design Guidelines for the Property or any portion thereof.

"Development Period" means the period of time beginning on the date when this Declaration has

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Declarant will have no obligation to establish Design Guidelines for the Property or any portion thereof.

"Development Period" means the period of time beginning on the date when this Declaration has been Recorded, and ending twenty (20) years thereafter, unless earlier terminated by a Recorded written instrument executed by Declarant. The Development Period is the period in which Declarant reserves the right to facilitate the development, construction, and marketing of the Property, and the right to direct the 3 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS size, shape and composition of the Property. The Development Period is for a term of years and does not require that Declarant own any portion of the Property.

"Homebuilder" means an Owner (other than Declarant) who acquires a Lot for the construction of a single-family residence for resale to a third party.

"Improvement” means all physical enhancements and alterations to the Property, including but not limited to grading, clearing, removal of trees, alteration of drainage flow, and site work, and every structure and all appurtenances of every type and kind, whether temporary or permanent in nature, including, but not limited to, buildings, outbuildings, storage sheds, patios, tennis courts, sport courts, recreational facilities, swimming pools, putting greens, garages, driveways, parking areas and/or facilities, storage buildings, sidewalks, fences, gates, screening walls, retaining walls, stairs, patios, decks, walkways, landscaping, mailboxes, poles, signs, antennas, exterior air conditioning equipment or fixtures, exterior lighting fixtures, water softener fixtures or equipment, and poles, pumps, wells, tanks, reservoirs, pipes,

mailboxes, poles, signs, antennas, exterior air conditioning equipment or fixtures, exterior lighting fixtures, water softener fixtures or equipment, and poles, pumps, wells, tanks, reservoirs, pipes, lines, meters, antennas, towers and other facilities used in connection with water, sewer, gas, electric, telephone, regular or cable television, or other utilities.

"Lot" means any portion of the Property designated by Declarant in a Recorded written instrument or as shown as a subdivided Lot on a Plat other than Common Area or Special Common Area.

"Majority" means more than half.

"Manager" has the meaning set forth in Section 4.5.8.

"Members" means every person or entity that holds membership privileges in the Association.

"Mortgage" or "Mortgages" means any mortgage(s) or deed(s) of trust securing indebtedness and covering any Lot.

"Mortgagee" or "Mortgagees" means the holder(s) of any Mortgage(s).

"Owner" means the person(s), entity or entities, including Declarant, holding all or a portion of the fee simple interest in any Lot, but does not include the Mortgagee under a Mortgage prior to its acquisition of fee simple interest in such Lot pursuant to foreclosure of the lien of its Mortgage.

thereto.

"Plat" means a Recorded subdivision plat of any portion of the Property, and any amendments "Property" means that certain real property located in Montgomery County, Texas, as more particularly described on Exhibit "A" attached hereto and incorporated herein for all purposes, subject to such additions thereto and deletions therefrom as may be made pursuant to Section 11.3 and Section 11.4 of this Declaration.

"Record", "Recordation", "Recorded" and "Recording" means recorded or to be recorded in the Official Public Records of Montgomery County, Texas.

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t to Section 11.3 and Section 11.4 of this Declaration.

"Record", "Recordation", "Recorded" and "Recording" means recorded or to be recorded in the Official Public Records of Montgomery County, Texas.

"Resident" means an occupant or tenant of a Lot, regardless of whether the person owns the Lot.

"Restrictions" means the restrictions, covenants, and conditions contained in this Declaration, the Design Guidelines, Bylaws, Community Manual, Rules and Regulations, or in any other rules and 4892-4621-0975v.3 51928-142 4 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS regulations promulgated by the Association pursuant to this Declaration, as adopted and amended from time to time. See Table 1 for a summary of the Restrictions.

"Rules and Regulations" means any instrument, however denominated, which Declarant may adopt as part of the initial project documentation for the regulation and management of the Property, the Common Area, or the Special Common Area, including any amendments to those instruments. Until expiration or termination of the Development Period, the Declarant may unilaterally amend the Rules and Regulations, and must approve any amendment to the Rules and Regulations adopted by the Board. Upon expiration or termination of the Development Period, the Rules and Regulations may be amended by a Majority of the Board.

"Service Area" means a group of Lots designated as a separate Service Area pursuant to this Declaration for purpose of receiving benefits or services from the Association which are not provided to all Lots. A Service Area may be comprised of more than one type of use or structure and may include noncontiguous Lots. A Lot may be assigned to more than one Service Area. Service Area boundaries may

all Lots. A Service Area may be comprised of more than one type of use or structure and may include noncontiguous Lots. A Lot may be assigned to more than one Service Area. Service Area boundaries may be established and modified as provided in Section 2.5.

"Service Area Assessments" means assessments levied against the Lots in a particular Service Area to fund Service Area Expenses, as described in Section 6.6.

"Service Area Expenses" means the estimated and actual expenses which the Association incurs or expects to incur for the benefit of Owners within a particular Service Area, which may include a reasonable reserve for capital repairs and replacements.

"Solar Energy Device" means a system or series of mechanisms designed primarily to provide heating or cooling or to produce electrical or mechanical power by collecting and transferring solargenerated energy. The term includes a mechanical or chemical device that has the ability to store solargenerated energy for use in heating or cooling or in the production of power.

"Special Common Area" means any interest in real property or improvements which is designated by Declarant in this Declaration or in any written instrument Recorded by Declarant (which designation will be made in the sole and absolute discretion of Declarant) as Special Common Area which is assigned for the purpose of exclusive use and/or the obligation to pay Special Common Area Assessments attributable thereto, to one or more, but less than all of the Lots or Owners, and is or will be conveyed to the Association or as to which the Association will be granted rights or obligations, or otherwise held by Declarant for the benefit of the Association. The Declaration or other written notice will identify the Lots

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or as to which the Association will be granted rights or obligations, or otherwise held by Declarant for the benefit of the Association. The Declaration or other written notice will identify the Lots or Owners assigned to such Special Common Area and further indicate whether the Special Common Area is assigned to such parties for the purpose of exclusive use and the payment of Special Common Area Assessments or only for the purpose of paying Special Common Area Assessments attributable thereto. By way of illustration and not limitation, Special Common Area might include such things as private drives and roads, entrance facilities and features, monumentation or signage, walkways or landscaping.

"Special Common Area Assessments" means assessments levied against the Lots as described in Section 6.5.

"Special Common Area Expenses" means the estimated and actual expenses which the Association incurs or expects to incur to operate, maintain, repair and replace Special Common Area, which may include a reasonable reserve for capital repairs and replacements.

5 AMENDED AND RESTATED 4892-4621-0975v.3 51928-142 DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS Declaration (Recorded) Certificate of Formation (Recorded) Bylaws (Recorded) Community Manual (Recorded) TABLE 1: RESTRICTIONS Creates obligations that are binding upon the Association and all present and future owners of the Property.

Establishes the Association as a Texas nonprofit corporation.

Governs the Association's internal affairs, such as elections, meetings, etc.

Establishes Rules and Regulations and policies governing the Association.

Design Guidelines (if adopted, Governs the design and architectural standards for the construction of Recorded)

meetings, etc.

Establishes Rules and Regulations and policies governing the Association.

Design Guidelines (if adopted, Governs the design and architectural standards for the construction of Recorded) Improvements and modifications thereto. Declarant shall have no obligation to adopt the Design Guidelines.

Rules and Regulations (if adopted, Recorded) Board Resolutions (adopted by the Board of the Association) Notice of Withdrawal of Land (Recorded) Notice of Addition of Land (Recorded) Notice of Plat Recordation (Recorded) Regulates the use of property, activities, and conduct within the Property, the Common Area, or the Special Common Area.

Establishes rules, policies, and procedures for the Property, Owners, and the Association.

Withdraws and removes land from the Property so that such land is no longer burdened by the terms of this Declaration and no longer under the jurisdiction of the Association.

Adds additional land to the Property, so such land will be considered part of the Property and subject to the terms of this Declaration and under the jurisdiction of the Association.

Identifies specific residential Lots within a Plat. Upon Recordation of a Notice of Plat Recordation, the Property included within the Plat not comprising a residential Lot will automatically be withdrawn from the terms and provisions of this Declaration. Declarant shall have no obligation to Record a Notice of Plat Recordation.

ARTICLE 2 GENERAL AND USE RESTRICTIONS Table 1 All of the Property shall be owned, held, encumbered, leased, used, occupied, and enjoyed subject to the following limitations and restrictions: 2.1 General.

2.1.1 Conditions and Restrictions. All Lots within the Property will be owned, held,

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encumbered, leased, used, occupied, and enjoyed subject to the following limitations and restrictions: 2.1 General.

2.1.1 Conditions and Restrictions. All Lots within the Property will be owned, held, encumbered, leased, used, occupied and enjoyed subject to the Restrictions and Applicable Law.

2.1.2 Ordinances. Ordinances and requirements imposed by local governmental authorities are applicable to all Lots within the Property. Compliance with the Restrictions is not a substitute for compliance with Applicable Law. Please be advised that the Restrictions do not purport to list or describe each restriction which may be applicable to a Lot located within the Property. Each Owner is advised to review all ordinances, requirements, regulations and encumbrances affecting the use and improvement of their Lot prior to submitting plans to the ACC for approval. Furthermore, approval by the ACC should not be construed by the Owner that any Improvement complies with the terms and provisions of any ordinances, requirements, regulations or encumbrances which may affect the Owner's Lot. Certain encumbrances may benefit parties whose interests are not addressed by the ACC.

6 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS 2.2 NOTICE The Restrictions are subject to change from time to time. By owning or occupying a Lot, you agree to remain in compliance with the Restrictions, as they may change from time to time.

Compliance with Applicable Law. The Association and each Owner, Homebuilder, Resident or other user of any portion of the Property must comply with the Restrictions and Applicable Law.

2.3 Conceptual Plans. All master plans, site plans, brochures, illustrations, information and

esident or other user of any portion of the Property must comply with the Restrictions and Applicable Law.

2.3 Conceptual Plans. All master plans, site plans, brochures, illustrations, information and marketing materials relating to the Property, the Common Area, or the Special Common Area (collectively, the "Conceptual Plans") are conceptual in nature and are intended to be used for illustrative purposes only.

The land uses and Improvements reflected on the Conceptual Plans, including but not limited to any amenity center(s), are subject to change at any time and from time to time, and it is expressly agreed and understood that land uses within the Property, the Common Area, or the Special Common Area may include uses which are not shown on the Conceptual Plans. Neither Declarant nor any Homebuilder or other developer of any portion of the Property, the Common Area, or the Special Common Area makes any representation or warranty concerning such land uses and Improvements shown on the Conceptual Plans or otherwise planned for the Property, the Common Area, or the Special Common Area and it is expressly agreed and understood that no Owner will be entitled to rely upon the Conceptual Plans or any statement made by Declarant or any of Declarant's representatives regarding proposed land uses or proposed or planned Improvements in making the decision to purchase any land or Improvements within the Property.

Each Owner who acquires a Lot within the Property acknowledges that development of the Property, the Common Area, and/or the Special Common Area will likely extend over many years, and agrees that the Association will not engage in, or use Association funds to support, protest, challenge, or make any other

Area, and/or the Special Common Area will likely extend over many years, and agrees that the Association will not engage in, or use Association funds to support, protest, challenge, or make any other form of objection to development of the Property, the Common Area, or the Special Common Area or changes in the Conceptual Plans as they may be amended or modified from time to time.

2.4 Single-Family Residential Use. The Lots shall be used solely for private single-family residential purposes.

No professional, business, or commercial activity to which the general public is invited shall be conducted on any Lot, except an Owner or Resident may conduct business activities within a residence so long as: (i) such activity complies with all Applicable Law; (ii) the business activity is conducted without the employment of persons other than the Residents of the home constructed in the Lot; (iii) the business activity does not involve customers, contractors, clients, or the general public visiting the Lot to conduct activities related to the business; (iv) the existence or operation of the business activity is not apparent or detectable by sight, i.e., no sign may be erected advertising the business on any Lot, sound, or smell from outside the residence; (v) the business activity does not involve door-to-door solicitation of Residents within the Property; (vi) the business does not, in the Board's judgment, generate a level of vehicular or pedestrian traffic or a number of vehicles parked within the Property which is noticeably greater than that which is typical of residences in which no business activity is being conducted; (vii) the business activity is consistent with the residential character of the Property and does not constitute a nuisance, or a hazardous

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residences in which no business activity is being conducted; (vii) the business activity is consistent with the residential character of the Property and does not constitute a nuisance, or a hazardous or offensive use, or threaten the security or safety of other Residents of the Property as may be determined in the sole discretion of the Board; and (viii) the business does not require the installation of any machinery other than that customary to normal household operations. In addition, for the purpose of obtaining any business or commercial license, neither the residence nor Lot will be considered open to the public. The terms "business" and "trade", as used in this provision, shall be construed to have their ordinary, generally 7 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS accepted meanings and shall include, without limitation, any occupation, work, or activity undertaken on an ongoing basis which involves the provision of goods or services to persons other than the provider's family and for which the provider receives a fee, compensation, or other form of consideration, regardless of whether: (x) such activity is engaged in full or part-time; (y) such activity is intended to or does generate a profit; or (z) a license is required.

Leasing of a residence shall not be considered a business or trade within the meaning of this subsection. This subsection shall not apply to any activity conducted by Declarant or a Homebuilder.

Notwithstanding any provision in this Declaration to the contrary, until the expiration or termination of the Development Period: (i) Declarant and/or its licensees may construct and maintain upon portions of the

ing any provision in this Declaration to the contrary, until the expiration or termination of the Development Period: (i) Declarant and/or its licensees may construct and maintain upon portions of the Common Area, the Special Common Area, any Lot, or portion of the Property owned by Declarant, such facilities and may conduct such activities, which, in Declarant's sole opinion, may be reasonably required, convenient, or incidental to the construction or sale of single-family residences or other Improvements constructed upon the Lots, including, but not limited to, business offices, signs, model homes, and sales offices. Declarant and/or its licensees shall have an easement over and across the Common Area and the Special Common Area for access and use of such facilities at no charge; and (ii) Declarant and/or its licensees will have an access easement over and across the Common Area and the Special Common Area for the purpose of making, constructing and installing Improvements upon the Common Area and the Special Common Area.

2.5 Provision of Benefits and Services to Service Areas.

2.5.1 Designation by Declarant. Declarant, in any Recorded written notice, may assign Lots to one or more Service Areas (by name or other identifying designation) as it deems appropriate, which Service Areas may be then existing or newly created, and may require that the Association provide benefits or services to such Lots in addition to those which the Association generally provides to the Property. Declarant may unilaterally amend any Recorded written notice to re-designate Service Area boundaries. All costs associated with the provision of services or benefits to a Service Area will be assessed against the Lots within the Service Area as a Service Area Assessment.

2.5.2

Service Area boundaries. All costs associated with the provision of services or benefits to a Service Area will be assessed against the Lots within the Service Area as a Service Area Assessment.

2.5.2 Petition by Owners. In addition to Service Areas which Declarant may designate, any group of Owners may petition the Board to designate their Lots as a Service Area for the purpose of receiving from the Association: (i) special benefits or services which are not provided to all Lots; or (ii) a higher level of service than the Association otherwise provides. Upon receipt of a petition signed by Owners of a Majority of the Lots within the proposed Service Area, the Board will investigate the terms upon which the requested benefits or services might be provided and notify the Owners in the proposed Service Area of such terms and associated expenses, which may include a reasonable administrative charge in such amount as the Board deems appropriate (provided, any such administrative charge will apply at a uniform rate per Lot among all Service Areas receiving the same service). Notwithstanding the foregoing, until expiration or termination of the Development Period, Declarant shall have the right to withhold its consent for any petition to designate Lots as a Service Area in Declarant's sole and absolute discretion. If approved by the Board, Declarant during the Development Period, and the Owners of at least sixty-seven percent (67%) of the total number of votes held by all Lots within the proposed Service Area, the Association will provide the requested benefits or services on the terms set forth in the proposal or in a manner otherwise acceptable to the Board. The cost and administrative charges associated with such

Page 14

iation will provide the requested benefits or services on the terms set forth in the proposal or in a manner otherwise acceptable to the Board. The cost and administrative charges associated with such benefits or services will be assessed against the Lots within such Service Area as a Service Area Assessment.

8 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS 2.5.3 Addition to and Removal from Service Areas. The Association may, from time to time, include additional components of Improvements or Lots or remove components of Improvements or Lots from a Service Area; however, unless otherwise approved by Declarant during the Development Period, in no event may the Association at any time remove from any Service Area components of any Improvements or Lots previously designated as a Service Area under this Declaration. During the Development Period, any addition to a Service Area must also be approved by Declarant. After expiration or termination of the Development Period, any addition or removal of components of Improvements or Lots must be approved by two-thirds (%) of the total number of votes held by all Lots within a Service Area. During the Development Period, the Service Area may be modified or amended by Declarant, acting alone. Any modification or amendment to the Service Area must be Recorded.

2.6 Rentals. Nothing in this Declaration shall prevent the rental of any Lot and the Improvements thereon by the Owner thereof for residential purposes; provided that all rentals must be for terms of at least six (6) months. All leases shall be in writing. The Owner must provide to its lessee copies

ereon by the Owner thereof for residential purposes; provided that all rentals must be for terms of at least six (6) months. All leases shall be in writing. The Owner must provide to its lessee copies of the Restrictions and shall notify its lessee of any changes or additions thereto. Notice of any lease, the contact information (address, phone number and email) of the lessee thereunder, and the start date and term of such lease shall be remitted to the Association by the Owner on or before the expiration of ten (10) days after the effective date of the lease.

2.7 Subdividing. No Lot shall be further divided or subdivided, nor may any easements or other interests therein less than the whole be conveyed by the Owner thereof without the prior written approval of the ACC; provided, however, that when Declarant is the Owner thereof, Declarant may further divide and subdivide any Lot and convey any easements or other interests less than the whole, all without the approval of the ACC.

2.8 Hazardous Activities. No activities may be conducted on or within the Property and no Improvements may be constructed on or within any portion of the Property which, in the opinion of the Board, are or might be unsafe or hazardous to any person or property. Without limiting the generality of the foregoing, no firearms or fireworks may be discharged upon any portion of the Property unless discharged in conjunction with an event approved in advance by the Board and no open fires may be lighted or permitted except within safe and well-designed fireplaces or in contained barbecue units while attended and in use for cooking purposes. No portion of the Property may be used for the takeoff, storage, or landing of aircraft (including, without limitation, helicopters) except for medical emergencies.

Page 15

ed and in use for cooking purposes. No portion of the Property may be used for the takeoff, storage, or landing of aircraft (including, without limitation, helicopters) except for medical emergencies.

2.9 Insurance Rates. Nothing shall be done or kept on the Property which would increase the rate of casualty or liability insurance or cause the cancellation of any such insurance on the Common Area or Special Common Area, or the Improvements located thereon, without the prior written approval of the Board.

2.10 Mining and Drilling. Except for the Third-Party Oil, Gas and Mineral Interests defined below, no portion of the Property, the Common Area, or the Special Common Area may be used for the purpose of mining, quarrying, drilling, boring, or exploring for or removing oil, gas, or other hydrocarbons, minerals of any kind, rocks, stones, sand, gravel, aggregate, or earth. This provision will not be construed to prevent the excavation of rocks, stones, sand, gravel, aggregate, or earth or the storage of such material for use as fill provided that such activities are conducted in conjunction with the construction of Improvements and/or the development of the Property, the Common Area, or the Special Common Area by Declarant. Furthermore, this provision will not be interpreted to prevent the drilling of water wells by Declarant or otherwise approved in advance by the ACC which are required to provide water to all or any portion of the Property. All water wells must also be approved in advance by the ACC and any applicable 4892-4621-0975v.3 51928-142 9 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS regulatory authority. This Section 2.10 shall not apply to minerals, resources and groundwater, or some

142 9 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS regulatory authority. This Section 2.10 shall not apply to minerals, resources and groundwater, or some portion thereof or some interest therein, that may have been conveyed or reserved by third parties prior to Declarant's ownership of the Property (the "Third-Party Oil, Gas and Mineral Interests"). No representation or warranty, express or implied, is made as to the ownership of the minerals, resources and groundwater or any portion thereof or any interest therein.

2.11 Noise. No noise or other nuisance shall be permitted to exist or operate upon any portion of the Property so as to be offensive or detrimental to any other portion of the Property or to its Residents.

This Section 2.11 shall not be construed to include noise caused by construction activities by Declarant or a Homebuilder.

2.12 Animals - Household Pets. No animals, including pigs, hogs, swine, poultry, fowl, wild animals, horses, cattle, sheep, goats, or any other type of animal not considered to be a domestic household pet within the ordinary meaning and interpretation of such words, may be kept, maintained, or cared for on or within the Property (as used in this paragraph, the term "domestic household pet" shall not mean or include non-traditional pets such pot-bellied pigs, miniature horses, chickens, exotic snakes or lizards, ferrets, monkeys, or other exotic animals). The Board may determine, in its sole discretion, whether a particular pet is a domestic household pet within the ordinary meaning and interpretation of such words.

No Owner or Resident may keep on such Owner's or Resident's Lot more than three (3) cats and dogs, in

ular pet is a domestic household pet within the ordinary meaning and interpretation of such words.

No Owner or Resident may keep on such Owner's or Resident's Lot more than three (3) cats and dogs, in the aggregate. No animal may be allowed to make an unreasonable amount of noise, or to become a nuisance, and no domestic pets will be allowed on the Property other than within the Owner's or Resident's residence, or the fenced yard space associated therewith, unless confined to a leash. The Association may restrict pets to certain areas on the Property. No animal may be stabled, maintained, kept, cared for, or boarded for hire or remuneration on the Property, and no kennels or breeding operation will be allowed.

No animal may be allowed to run at large, and all animals must be kept within enclosed areas which must be clean, sanitary, and reasonably free of refuse, insects, and waste at all times. No pet may be left unattended in yards, porches or other outside area. All pet waste will be removed and appropriately disposed of by the owner of the pet. All pets not confined to a residence must wear collars with appropriate identification tags and all outdoor cats are required to have a bell on their collar. All pets must be registered, licensed and inoculated as required by Applicable Law. If the Board determines, in its sole discretion, that a pet becomes a source of unreasonable annoyance to others, or the owner of the pet fails or refuses to comply with these restrictions, the Owner, upon written notice, may be required to remove the pet from the Property.

2.13 Rubbish and Debris. As determined by the Board, no rubbish or debris of any kind may be placed or permitted to accumulate on or within the Property, and no odors will be permitted to arise

Page 16

perty.

2.13 Rubbish and Debris. As determined by the Board, no rubbish or debris of any kind may be placed or permitted to accumulate on or within the Property, and no odors will be permitted to arise therefrom so as to render all or any portion of the Property unsanitary, unsightly, offensive, or detrimental to any other property or Residents. Refuse, garbage, and trash must be kept at all times in covered containers, and such containers must be kept within enclosed structures or appropriately screened from view. Each Owner will contract with an independent disposal service to collect all garbage or other wastes, if such service is not provided by a governmental entity or the Association.

2.14 Trash Containers. Trash containers and recycling bins must be stored adjacent to or inside of the garage of the single-family residence constructed on the Lot. The Board shall have the right to specify additional locations on each Owner's Lot in which trash containers or recycling bins must be stored.

2.15 Maintenance. The Owners of each Lot shall jointly and severally have the duty and responsibility, at their sole cost and expense, to keep their Lot and all Improvements thereon in good condition and repair and in a well-maintained, safe, clean and attractive condition at all times. The Board, 4892-4621-0975v.3 51928-142 10 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS in its sole discretion, shall determine whether a violation of the maintenance obligations set forth in this Section 2.15 has occurred. Such maintenance includes, but is not limited to the following, which shall be performed in a timely manner, as determined by the Board, in its sole discretion: (i) Prompt removal of all litter, trash, refuse, and wastes.

(ii)

but is not limited to the following, which shall be performed in a timely manner, as determined by the Board, in its sole discretion: (i) Prompt removal of all litter, trash, refuse, and wastes.

(ii) Lawn mowing and edging.

(iii) Tree and shrub pruning.

(iv) Watering of lawn and landscaping.

(v) Keeping exterior lighting and mechanical facilities in working order.

(vi) (vii) Keeping planting beds free of turf Keeping lawn and garden areas alive, free of weeds, and attractive.

grass.

(viii) Keeping sidewalks and driveways in good repair.

(ix) Complying with Applicable Law.

2.16 (x) (xi) Repainting of Improvements.

Repair of exterior damage, and wear and tear to Improvements.

Street Landscape Area-Owner's Obligation to Maintain Landscaping. Each Owner will be responsible, at such Owner's sole cost and expense, for maintaining mowing, replacing, pruning, and irrigating the landscaping between the boundary of such Owner's Lot and the curb of any adjacent rightof-way, street or alley (the "ST Landscape Area") unless the responsibility for maintaining the ST Landscape Area is performed by the Association and/or the City. If the maintenance of any ST Landscape Area is the responsibility of the City, and the City fails to properly maintain the ST Landscape Area, as determined in the sole and absolute discretion of the Board, the Association, if allowed by Applicable Law, may have the responsibility for maintaining such ST Landscape Area and the costs incurred, or estimated to be incurred, by the Association shall be discharged through Assessments.

2.17 Antennas. Except as expressly provided below, no exterior radio or television antennas or aerial or satellite dish or disc, shall be erected, maintained or placed on a Lot without the prior written

Page 17

17 Antennas. Except as expressly provided below, no exterior radio or television antennas or aerial or satellite dish or disc, shall be erected, maintained or placed on a Lot without the prior written approval of the ACC; provided, however, that: (i) an antenna designed to receive direct broadcast services, including direct-to-home satellite services, that is one meter or less in diameter; or (ii) an antenna designed to receive video programming services via multipoint distribution services, including multi-channel multipoint distribution services, instructional television fixed services, and local multipoint distribution services, that is one meter or less in diameter or diagonal measurement; or (iii) an antenna that is designed to receive television or radio broadcast signals, (collectively, (i) through (iii) are referred to herein as the "Permitted Antennas") will be permitted subject to reasonable requirements as to location and screening as may be set forth in rules adopted by the ACC, consistent with Applicable Law, in order to minimize obtrusiveness as viewed from streets and adjacent property. Declarant and/or the Association will have the right, but not the obligation, to erect an aerial, satellite dish, or other apparatus for a master antenna, cable, or other communication system for the benefit of all or any portion of the Property.

4892-4621-0975v.3 51928-142 11 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS 2.18 Location of Permitted Antennas. A Permitted Antenna may be installed solely on the Owner's Lot and shall not encroach upon any street, Common Area, Special Common Area, or any other portion of the Property. A Permitted Antenna shall be installed in a location on the Lot from which an

wner's Lot and shall not encroach upon any street, Common Area, Special Common Area, or any other portion of the Property. A Permitted Antenna shall be installed in a location on the Lot from which an acceptable quality signal can be obtained and where least visible from the street and the Property, other than the Lot. In order of preference, the locations of a Permitted Antenna which will be considered least visible by the ACC are as follows: (i) Attached to the back of the principal single-family residence constructed on the Lot, with no part of the Permitted Antenna any higher than the roof fascia, soffit, or bargeboard and screened from view of adjacent Lots and the street; then (ii) Attached to the side of the principal single-family residence constructed on the Lot, with no part of the Permitted Antenna any higher than the roof fascia, soffit, or bargeboard and screened from view of adjacent Lots and the street.

The ACC may, from time to time, modify, amend, or supplement the rules regarding installation and placement of Permitted Antennas.

2.19 Satellite dishes one meter or less in diameter, e.g., DirecTV or Dish satellite dishes, are permitted, HOWEVER, you are required to comply with the rules regarding installation and placement. These Rules and Regulations may be modified by the ACC from time to time. Please contact the ACC for the current rules regarding installation and placement.

Signs. Unless otherwise prohibited by Applicable Law, no sign of any kind may be displayed to the public view on any Lot without the prior written approval of the ACC, except for: signs which are expressly permitted pursuant to the Design Guidelines or Rules (i) and Regulations; (ii) signs which are part of Declarant's or Homebuilder's overall marketing, sale, or

C, except for: signs which are expressly permitted pursuant to the Design Guidelines or Rules (i) and Regulations; (ii) signs which are part of Declarant's or Homebuilder's overall marketing, sale, or construction plans or activities for the Property; (iii) a maximum of two (2) school or youth affiliated signs shall be permitted, provided the sign(s): (a) is located in the landscaping bed of the front yard and blends in with the existing landscaping; (b) is no larger than 36" x 42" and does not exceed five feet (5') in height above natural ground; (c) is constructed of wood, plastic or metal and are not flags or banners, as determined in the sole and absolute discretion of the Board; (d) is kept in good condition and repair, as determined in the sole and absolute discretion of the Board; (e) does not cause embarrassment, discomfort and/or annoyance to other Owners, as determined in the sole and absolute discretion of the Board; and (f) does not contain any telephone numbers or commercial advertisement; (iv) one (1) temporary "For Sale" sign placed on the Lot. The sign must be professionally made and shall be limited to a maximum face area of five (5) square feet on each visible side and, if free standing, is mounted on a single or frame post. The overall height of the sign from the finished grade of the Lot at the spot where the sign is located may not exceed four feet (4'). The sign must be removed within two (2) business days following the sale of the Lot; (v) candidate or measure signs may be erected provided the sign: (a) is erected no earlier than the ninetieth (90th) day before the date of the election to which the sign relates; (b) is removed no later than the tenth (10th) day after the date of the election to which the sign relates;

Page 18

ier than the ninetieth (90th) day before the date of the election to which the sign relates; (b) is removed no later than the tenth (10th) day after the date of the election to which the sign relates; and (c) is ground-mounted. Only one sign may be erected for each candidate or measure. In 4892-4621-0975v.3 51928-142 12 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS addition, signs which include any of the components or characteristics described in Section 259.002(d) of the Texas Election Code are prohibited; (vi) (vii) (viii) permits as may be required by legal proceedings; permits as may be required by any governmental entity; and one "no soliciting" or "security warning" sign near or on the front door of the residence, provided that the sign may not exceed twenty-five (25) square inches.

For Lease and For Rent signs are expressly prohibited.

2.20 Flags -Approval Requirements. An Owner is permitted to display the flag of the United States of America, the flag of the State of Texas, an official or replica flag of any branch of the United States armed forces, or one (1) flag with official insignia of a college or university ("Permitted Flag") and is permitted to install a flagpole no more than five feet (5') in length affixed to the front of a residence near the principal entry or affixed to the rear of a residence ("Permitted Flagpole"). Only two (2) Permitted Flagpoles are allowed per residence. A Permitted Flag or Permitted Flagpole need not be approved in advance by the ACC. Approval by the ACC is required prior to installing vertical freestanding flagpoles in the front or back yard area of any Lot ("Freestanding Flagpole"). To obtain approval of any Freestanding

the ACC. Approval by the ACC is required prior to installing vertical freestanding flagpoles in the front or back yard area of any Lot ("Freestanding Flagpole"). To obtain approval of any Freestanding Flagpole, the Owner shall provide the ACC with the following information: (i) the location of the Freestanding Flagpole to be installed on the Lot; (ii) the type of Freestanding Flagpole to be installed; (iii) the dimensions of the Freestanding Flagpole; and (iv) proposed materials of the Freestanding Flagpole (the "Flagpole Application"). A Flagpole Application may only be submitted by an Owner. The Flagpole Application shall be submitted in accordance with the provisions of Article 7.

2.21 Flags Installation and Display. Unless otherwise approved in advance and in writing by the ACC, Permitted Flags, Permitted Flagpoles and Freestanding Flagpoles, installed in accordance with the Flagpole Application, must comply with the following: (i) No more than one (1) Freestanding Flagpole OR no more than two (2) Permitted Flagpoles are permitted per Lot, on which only Permitted Flags may be displayed; (ii) Any Permitted Flagpole must be no longer than five feet (5') in length and any Freestanding Flagpole must be no more than twenty feet (20') in height; (iii) Any Permitted Flag displayed on either a Permitted Flagpole or a Freestanding Flagpole may not be more than three feet in height by five feet in width (3'x5'); (iv) The flag of the United States of America must be displayed in accordance with 4 U.S.C. Sections 5-10 and the flag of the State of Texas must be displayed in accordance with Chapter 3100 of the Texas Government Code; (v) The display of a Permitted Flag, or the location and construction of a Permitted

Page 19

and the flag of the State of Texas must be displayed in accordance with Chapter 3100 of the Texas Government Code; (v) The display of a Permitted Flag, or the location and construction of a Permitted Flagpole or Freestanding Flagpole must comply with all Applicable Law, easements and setbacks of record; (vi) Each Permitted Flagpole and Freestanding Flagpole must be constructed of permanent, long-lasting materials, with a finish appropriate to the materials used in the construction thereof and harmonious with the residence; (vii) Any Permitted Flag, Permitted Flagpole, and Freestanding Flagpole must be maintained in good condition and any deteriorated Permitted Flag or deteriorated or structurally unsafe Permitted Flagpole or Freestanding Flagpole must be repaired, replaced or removed; 4892-4621-0975v.3 51928-142 13 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS (viii) A Permitted Flag may be illuminated by no more than one (1) halogen landscaping light of low beam intensity which shall not be aimed towards or directly affect any neighboring Lot; and (ix) Any external halyard of a Permitted Flagpole or Freestanding Flagpole must be secured so as to reduce or eliminate noise from flapping against the metal of the Permitted Flagpole or Freestanding Flagpole.

2.22 Tanks. The ACC must approve any tank used or proposed in connection with a residence, including tanks for storage of fuel, water, oil, or liquid petroleum gas (LPG), and including swimming pool filter tanks. No elevated tanks of any kind may be erected, placed or permitted on any Lot without the advance written approval of the ACC. All permitted tanks must be screened from view in accordance with

r tanks. No elevated tanks of any kind may be erected, placed or permitted on any Lot without the advance written approval of the ACC. All permitted tanks must be screened from view in accordance with a screening plan approved in advance by the ACC. This provision will not apply to a tank used to operate a standard residential gas grill.

2.23 Temporary Structures. No tent, shack, or other temporary building, Improvement, or structure shall be placed upon the Property without the prior written approval of the ACC; provided, however, that temporary structures necessary for storage of tools and equipment, and for office space for Declarant, Homebuilders, architects, and foremen during actual construction may be maintained with the prior approval of Declarant (unless placed by Declarant), approval to include the nature, size, duration, and location of such structure.

2.24 Outside Storage Buildings. Outside storage buildings located in a fenced rear yard of a Lot are allowed with the prior written approval of the ACC. One (1) permanent storage building will be permitted if: (i) the surface area of the pad on which the storage building is constructed is no more than one hundred (100) square feet; (ii) the height of the storage building, measured from the surface of the Lot, is no more than eight feet (8'); (iii) the exterior of the storage building is constructed of the same or substantially similar materials and of the same color as the principal residential structure constructed on the Lot; (iv) the roof of the storage building is the same material and color as the roof of the principal residential structure constructed on the Lot; and (v) the storage building is constructed within all applicable building setbacks. No storage building may be used for habitation.

2.25

of the principal residential structure constructed on the Lot; and (v) the storage building is constructed within all applicable building setbacks. No storage building may be used for habitation.

2.25 Unsightly Articles; Vehicles. No article deemed to be unsightly by the Board will be permitted to remain on any Lot so as to be visible from adjoining property or from public or private thoroughfares. Without limiting the generality of the foregoing, trailers, graders, trucks other than pickups, boats, tractors, campers, wagons, buses, motorcycles, motor scooters, all-terrain vehicles and garden maintenance equipment shall be kept at all times except when in actual use, in enclosed structures or screened from view and no repair or maintenance work shall be done on any of the foregoing, or on any automobile (other than minor emergency repairs), except in enclosed garages or other structures. Service areas, storage areas, compost piles and facilities for hanging, drying or airing clothing or household fabrics shall be appropriately screened from view, and no lumber, grass, plant waste, shrub or tree clippings, metals, bulk materials, scrap, refuse or trash shall be kept, stored, or allowed to accumulate on any portion of the Property except within enclosed structures or appropriately screened from view. No: (i) racing vehicles; or (ii) other vehicles (including, without limitation, motorcycles or motor scooters) which are inoperable or do not have a current license tag shall be permitted to remain visible on any Lot or to be parked on any roadway within the Property, the Common Area, or the Special Common Area.

2.26 Parking. All Owners and Residents are encouraged to park vehicles in the garage on their

Page 20

n any Lot or to be parked on any roadway within the Property, the Common Area, or the Special Common Area.

2.26 Parking. All Owners and Residents are encouraged to park vehicles in the garage on their Lot and use the driveways on their Lot as overflow parking. On street parking is limited to guests and 14 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS visitors. No vehicle may obstruct the flow of traffic, constitute a nuisance, or otherwise create a safety hazard. No vehicle may be parked in a manner that obstructs or otherwise blocks ingress and egress to any part of the Property by an emergency vehicle. The parking of vehicles in the yard of any Lot is not permitted.

2.27 Mobile Homes, Travel Trailers and Recreational Vehicles. No mobile homes, travel trailers or recreational vehicles shall be parked or placed on any street right-of-way, Lot, or used as a residence, either temporary or permanent, at any time. However, such vehicles may be parked temporarily for a period not to exceed seventy-two (72) consecutive hours during each two (2) month period.

2.28 Basketball Goals; Permanent and Portable. Permanent basketball goals are permitted in the driveway on a Lot. Permanent basketball goals are not permitted in any street right-of-way. The basketball goal backboard must be perpendicular to the street and mounted on a metal pole permanently installed in the ground. Portable basketball goals are permitted but must be stored inside the garage when not in use. Portable basketball goals are not permitted in any street right-of-way. Basketball goals must be properly maintained and painted, with the net in good repair.

2.29

d inside the garage when not in use. Portable basketball goals are not permitted in any street right-of-way. Basketball goals must be properly maintained and painted, with the net in good repair.

2.29 Compliance with Restrictions. Each Owner, their family, Residents of a Lot, tenants, and the guests, invitees, and licensees of the preceding shall comply strictly with the provisions of the Restrictions, as they may be amended from time to time. Failure to comply with any of the Restrictions shall constitute a violation of the Restrictions and may result in a fine against the Owner in accordance with Section 6.14 of this Declaration, and shall give rise to a cause of action to recover sums due for damages or injunctive relief, or both, maintainable by Declarant, the Board on behalf of the Association, the ACC, or by an aggrieved Owner. The result of every act or omission that violates any provision of the Restrictions is a nuisance, and any remedy allowed by law against a nuisance, either public or private, is applicable against the violation. Without limiting any rights or powers of the Association, the Board may (but shall not be obligated to) remedy or attempt to remedy any violation of any of the provisions of the Restrictions, and the Owner whose violation has been so remedied shall be personally liable to the Association for all costs and expenses of effecting (or attempting to effect) such remedy. If such Owner fails to pay such costs and expenses upon demand by the Association, such costs and expenses (plus interest from the date of demand until paid at the maximum lawful rate, or if there is no such maximum lawful rate, at the rate of one and one-half percent (1½%) per month) shall be assessed against and chargeable to the Owner's Lot(s). Any

Page 21

aid at the maximum lawful rate, or if there is no such maximum lawful rate, at the rate of one and one-half percent (1½%) per month) shall be assessed against and chargeable to the Owner's Lot(s). Any such amounts assessed and chargeable against a Lot shall be secured by the liens reserved in this Declaration for Assessments and may be collected by any means provided in this Declaration for the collection of Assessments, including, but not limited to, foreclosure of such liens against the Owner's Lot(s).

Each such Owner shall release and hold harmless the Association and its officers, directors, employees and agents from any cost, loss, damage, expense, liability, claim or cause of action incurred or that may arise by reason of the Association's acts or activities under this Section 2.29 (including any cost, loss, damage, expense, liability, claim or cause of action arising out of the Association's negligence in connection therewith), except for such cost, loss, damage, expense, liability, claim or cause of action arising by reason of the Association's gross negligence or willful misconduct. "Gross negligence" as used herein does not include simple negligence, contributory negligence or similar negligence short of actual gross negligence.

2.30 Liability of Owners for Damage to Common Area or Special Common Area. No Owner shall in any way alter, modify, add to or otherwise perform any work upon the Common Area or Special Common Area without the prior written approval of the Declarant during the Development Period, and the Board thereafter. Each Owner shall be liable to the Association for any and all damages to: (i) the 15 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS

h Owner shall be liable to the Association for any and all damages to: (i) the 15 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS Common Area and Special Common Area, and any Improvements constructed thereon; or (ii) any Improvements constructed on any Lot, the maintenance of which has been assumed by the Association, which damages were caused by the neglect, misuse or negligence of such Owner or Owner's family, or by any tenant or other Resident of such Owner's Lot, or any guest or invitee of such Owner or Resident. The full cost of all repairs of such damage shall be an Individual Assessment against such Owner's Lot, secured by a lien against such Owner's Lot and collectable in the same manner as provided in Section 6.12 of this Declaration.

2.31 Release. EACH OWNER HEREBY RELEASES AND HOLDS HARMLESS THE ASSOCIATION, DECLARANT, THE ACC AND THEIR AFFILIATES, OFFICERS, DIRECTORS, COMMITTEE MEMBERS, EMPLOYEES AND AGENTS FROM ANY COST, LOSS, DAMAGE, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION INCURRED OR THAT MAY ARISE BY REASON OF SUCH OWNER'S USE OF ANY COMMON AREA OR SPECIAL COMMON AREA.

Neither the Association nor Declarant will assume any responsibility or liability for any personal injury or property damage which is occasioned by use of any Common Area or Special Common Area, and in no circumstance will words or actions by the Association or Declarant constitute an implied or express representation or warranty regarding the fitness or condition of any Common Area or Special Common Area.

2.32 No Warranty of Enforceability. Declarant makes no warranty or representation as to the present or future validity or enforceability of the Restrictions. Any Owner acquiring a Lot in reliance on

.

2.32 No Warranty of Enforceability. Declarant makes no warranty or representation as to the present or future validity or enforceability of the Restrictions. Any Owner acquiring a Lot in reliance on one or more of the Restrictions shall assume all risks of the validity and enforceability thereof and, by acquiring the Lot, agrees to hold Declarant harmless therefrom.

2.33 Party Wall. A fence or wall located on or near the dividing line between two (2) Lots and intended to benefit both Lots constitutes a "Party Wall" and, to the extent not inconsistent with the provisions of this Section 2.33, is subject to the general rules of law regarding party walls and liability for property damage due to negligence, willful acts, or omissions and are subject to the following.

2.33.1 Encroachments & Easement. If the Party Wall is on one Lot due to an error in construction, the Party Wall is nevertheless deemed to be on the dividing line for purposes of this Section 2.33. Each Lot sharing a Party Wall is subject to an easement for the existence and continuance of any encroachment by the Party Wall as a result of construction, repair, shifting, settlement, or movement in any portion of the Party Wall, so that the encroachment may remain undisturbed as long as the Party Wall stands. Each Lot is subject to a reciprocal easement for the maintenance, repair, replacement, or reconstruction of the Party Wall.

2.33.2 Right to Repair. If the Party Wall is damaged or destroyed from any cause, the Owner of either Lot may repair or rebuild the Party Wall to its previous condition, and the Owners of both Lots, their successors and assigns, have the right to the full use of the repaired or rebuilt Party Wall. No

Page 22

Lot may repair or rebuild the Party Wall to its previous condition, and the Owners of both Lots, their successors and assigns, have the right to the full use of the repaired or rebuilt Party Wall. No Party Wall may be constructed, repaired, or rebuilt without the advance written approval of the ACC in accordance with Article 7 of this Declaration.

2.33.3 Maintenance Costs. The Owners of the adjoining Lots share equally the costs of repair, reconstruction, or replacement of the Party Wall, subject to the right of one Owner to call for larger contribution from the other under any rule of law regarding liability for negligence or willful acts or omissions. If an Owner is solely responsible for damage to or destruction of the Party Wall, that Owner will bear the entire cost of repair, reconstruction, or replacement. If an Owner fails or refuses to pay 16 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS his or her share of costs of repair or replacement of the Party Wall, the Owner advancing monies has a right to file a claim of lien for the monies advanced in the Official Public Records of Montgomery County, Texas, and has the right to foreclose the lien as if it were a mechanic's lien. The right of an Owner to require contribution from another Owner under this Section 2.33 is appurtenant to the Lot and passes to the Owner's successors in title.

2.33.4 Alterations. The Owner of a Lot sharing a Party Wall may not cut openings in the Party Wall or alter or change the Party Wall in any manner that affects the use, condition, or appearance of the Party Wall to the adjoining Lot. The Party Wall will always remain in the same location as when erected

ter or change the Party Wall in any manner that affects the use, condition, or appearance of the Party Wall to the adjoining Lot. The Party Wall will always remain in the same location as when erected unless otherwise approved by the Owner of each Lot sharing the Party Wall and the ACC.

2.33.5 Dispute Resolution. In the event of any dispute arising concerning a Party Wall, or under the provisions of this Section 2.33 (the "Dispute"), the parties shall submit the Dispute to mediation.

Should the parties be unable to agree on a mediator within ten (10) days after written request therefore by the Board, the Board shall appoint a mediator. If the Dispute is not resolved by mediation, the Dispute shall be resolved by binding arbitration. Either party may initiate the arbitration. Should the parties be unable to agree on an arbitrator within ten (10) days after written request therefore by the Board, the Board shall appoint an arbitrator. The decision of the arbitrator shall be binding upon the parties and shall be in lieu of any right of legal action that either party may have against the other. In the event an Owner fails to properly and on a timely basis (both standards to be determined by the Board in the Board's sole and absolute discretion) implement the decision of the mediator or arbitrator, as applicable, the Board may implement said mediator's or arbitrator's decision, as applicable. If the Board implements the mediator's or arbitrator's decision on behalf of an Owner, the Owner otherwise responsible therefor will be personally liable to the Association for all costs and expenses incurred by the Association in conjunction therewith. If such Owner fails to pay such costs and expenses upon demand by the Association, such costs and expenses

Association for all costs and expenses incurred by the Association in conjunction therewith. If such Owner fails to pay such costs and expenses upon demand by the Association, such costs and expenses (plus interest from the date of demand until paid at the maximum lawful rate, or if there is no such maximum lawful rate, at the rate of one and one-half percent (1½%) per month) will be assessed against and chargeable to the Owner's Lot(s). Any such amounts assessed and chargeable against a Lot hereunder will be secured by the liens reserved in this Declaration for Assessments and may be collected by any means provided in this Declaration for the collection of Assessments, including, but not limited to, foreclosure of such liens against the Owner's Lot(s).

2.34 Common Retaining Walls.

2.34.1 Maintenance of Common Retaining Wall. All retaining walls ("Common Retaining Wall") installed on Property will be an Association Maintenance Feature and be maintained by the Association. The Association is solely responsible for all maintenance, repair and reconstruction of the Common Retaining Wall unless the damage to the Common Retaining Wall was due to the negligence or willful act or misconduct of an Owner, in which case such costs shall be paid by such Owner through Individual Assessments. The Common Retaining all shall be maintained in substantially the same location, size, style and design as originally installed and be maintained on a maintenance schedule and manner as the Association shall determine, in its reasonable discretion.

2.34.2 Easements for Common Retaining Wall. There is hereby created an easement in and on the Lot where the Common Retaining Wall is actually located. The easement area shall be limited

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le discretion.

2.34.2 Easements for Common Retaining Wall. There is hereby created an easement in and on the Lot where the Common Retaining Wall is actually located. The easement area shall be limited to the area that is within five feet (5') of the common boundary line. The easement shall be for the benefit of the Association so that the Association can maintain the Common Retaining Wall as provided above.

EACH OWNER AND OCCUPANT HEREBY RELEASES AND BOLDS HARMLESS THE ASSOCIATION, ITS OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS FROM ANY COST, 17 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS LOSS, DAMAGE, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION INCURRED OR THAT MAY ARISE BY REASON OF THE ASSOCIATION'S ACTS OR ACTIVITIES UNDER THIS SECTION 2.34.2 (INCLUDING ANY COST, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION ARISING OUT OF THE ASSOCIATION'S NEGLIGENCE IN CONNECTION THEREWITH), EXCEPT TO THE EXTENT SUCH COST, LOSS, DAMAGE, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION ARISING BY REASON OF THE ASSOCIATION'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. "GROSS NEGLIGENCE" DOES NOT INCLUDE SIMPLE NEGLIGENCE OR SIMILAR NEGLIGENCE SHORT OF ACTUAL GROSS NEGLIGENCE.

2.34.3 Right of Enjoyment. The owner of a Lot with a Common Retaining Wall located thereon is granted a non-exclusive and perpetual right and easement of enjoyment and use over the exterior surface of the Common Retaining Wall for use as a perimeter wall or fence of such Lot.

2.35 Playscapes and Sport Courts. Playscapes and sport courts are permissible at the sole discretion of the ACC. If allowed, these facilities must be properly sited and screened so as to minimize

Lot.

2.35 Playscapes and Sport Courts. Playscapes and sport courts are permissible at the sole discretion of the ACC. If allowed, these facilities must be properly sited and screened so as to minimize the visual and audio impact of the facility on adjacent properties. Sport courts may not be lighted or enclosed with netting. Tennis courts are not permitted.

2.36 Decorations and Lighting. No decorative appurtenances such as sculptures, birdbaths and birdhouses, fountains, or other decorative embellishments shall be placed on the residence or on the front yard or on any other portion of a Lot which is visible from any street, unless such specific items have been approved in writing by the ACC. Customary seasonal decorations for holidays are permitted without approval by the ACC but shall be removed within thirty (30) days of the applicable holiday. Outside lighting fixtures shall be placed so as to illuminate only the yard of the applicable Lot and so as not to affect or reflect into surrounding Lots or yards. No mercury vapor, sodium or halogen light shall be installed on any Lot which is visible from any street unless otherwise approved by the ACC.

2.37 Water Quality Facilities, Drainage Facilities and Drainage Ponds. The Property may include, now or in the future, one or more water quality facilities, sedimentation, drainage and detention facilities, or ponds which serve all or a portion of the Property and are inspected, maintained and administered by the Association in accordance with all Applicable Law. Access to these facilities and ponds is limited to persons engaged by the Association to periodically maintain such facilities. Each Owner is advised that the water quality facilities, sedimentation, drainage and detention facilities and ponds are an

Page 24

persons engaged by the Association to periodically maintain such facilities. Each Owner is advised that the water quality facilities, sedimentation, drainage and detention facilities and ponds are an active utility feature integral to the proper operation of the Property and may periodically hold standing water. Each Owner is advised that entry into the water quality facilities, sedimentation, drainage and detention facilities or ponds may result in injury and is a violation of the Rules and Regulations, unless otherwise approved by the Association.

2.38 Release and Indemnity. EACH OWNER AND OWNER'S FAMILY MEMBERS, GUESTS, TENANTS, INVITEES, AGENTS, AND CONTRACTORS (EACH, A "USER" HEREIN) HEREBY RELEASE AND HOLD HARMLESS THE ASSOCIATION, DECLARANT, THE ACC AND THEIR AFFILIATES, OFFICERS, DIRECTORS, COMMITTEE MEMBERS, EMPLOYEES AND AGENTS FROM ANY COST, LOSS, DAMAGE, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION INCURRED OR THAT MAY ARISE BY REASON OF USER'S USE OF ANY COMMON AREA PROPERTY, COMMUNITY AMENITIES, OR COMMUNITY FACILITIES. EVERY USER IDENTIFIED ABOVE SHALL INDEMNIFY AND HOLD HARMLESS THE ASSOCIATION, DECLARANT, THE ACC AND THEIR AFFILIATES, OFFICERS, DIRECTORS, COMMITTEE MEMBERS, EMPLOYEES AND AGENTS FROM ANY COST, LOSS, DAMAGE, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION FOR PERSONAL INJURY OR PROPERTY DAMAGE INCURRED OR THAT MAY ARISE BY REASON OF THE USE OF OR ENTRY 18 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS UPON ANY COMMON AREA PROPERTY, COMMUNITY AMENITIES, OR COMMUNITY FACILITIES (INCLUDING ANY COST, FEES, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION ARISING OUT OF THE ASSOCIATION'S OR DECLARANT'S NEGLIGENCE IN CONNECTION THEREWITH), EXCEPT

Y AMENITIES, OR COMMUNITY FACILITIES (INCLUDING ANY COST, FEES, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION ARISING OUT OF THE ASSOCIATION'S OR DECLARANT'S NEGLIGENCE IN CONNECTION THEREWITH), EXCEPT FOR SUCH COST, LOSS, DAMAGE, EXPENSE, LIABILITY, CLAIM OR CAUSE OF ACTION ARISING BY REASON OF THE ASSOCIATION OR DECLARANT'S GROSS NEGLIGENCE OR WILFUL MISCONDUCT. "GROSS NEGLIGENCE" AS USED HEREIN DOES NOT INCLUDE SIMPLE NEGLIGENCE, CONTRIBUTORY NEGLIGENCE, OR SIMILAR NEGLIGENCE SHORT OF ACTUAL GROSS NEGLIGENCE. USE OF ANY COMMON AREA PROPERTY, COMMUNITY AMENITIES, OR COMMUNITY FACILITIES IS CONDITIONED UPON ACCEPTANCE OF THE FOREGOING RELEASE AND INDEMNITY OBLIGATIONS.

2.39 Model Home. Declarant may construct, or the ACC may approve, a model home constructed on a Lot with exterior finishes, fencing and other components that do not conform to the requirements imposed on other single-family residences within the Property. Declarant's construction, or approval by the ACC, of a model home which differs from the requirements imposed on other singlefamily residences within the Property shall in no event constitute a waiver of the terms and provisions of the Restrictions.

2.40 Removal of Soil and Trees. The digging and removal of soil from any Lot by any party other than Declarant is expressly prohibited except as necessary in conjunction with the landscaping or construction of Improvements upon a Lot in accordance with plans and specifications approved by the ACC in accordance with Article 7 of this Declaration. Unless otherwise approved in writing by the ACC, no tree shall be removed from a Lot except by Declarant unless otherwise approved in advance and in writing by the ACC.

3.1 ARTICLE 3 CONSTRUCTION RESTRICTIONS

therwise approved in writing by the ACC, no tree shall be removed from a Lot except by Declarant unless otherwise approved in advance and in writing by the ACC.

3.1 ARTICLE 3 CONSTRUCTION RESTRICTIONS Approval for Construction. Unless prosecuted by Declarant, no Improvements shall hereafter be placed, maintained, erected, or constructed upon any Lot without the prior written approval of the ACC in accordance with Article 7 of this Declaration.

3.2 Fences; Sidewalks. All fences and walls shall comply with all Applicable Law. Unless otherwise approved by the ACC, no fence, wall or hedge will be erected or maintained on any Lot nearer to the street than the front elevation of the residence constructed on the Lot, except for fences erected in conjunction with the model homes or sales offices. The ACC will have the sole discretion to determine the front elevation of the residence for the purpose of this Section 3.2. No chain-link, cloth or agricultural fences may be installed or maintained on a Lot, except by Declarant. Each Owner must maintain all fences on such Owner's Lot in good condition, including but not limited to periodically re-staining all fences on such Owner's Lot using stain substantially similar to the stain applied to the fences as originally constructed by Declarant, as determined by the ACC. Any broken pickets, fallen or leaning panels must be repaired or replaced. If required by the Plat, the Owner of each Lot shall construct, at such Owner's sole cost and expense and prior to occupying any Improvement, a sidewalk on such Owner's Lot, located and designed in conformance with the Plat.

3.3 Drainage. There shall be no interference with the established drainage patterns over any

Page 25

cupying any Improvement, a sidewalk on such Owner's Lot, located and designed in conformance with the Plat.

3.3 Drainage. There shall be no interference with the established drainage patterns over any of the Property, including the Lots, except by Declarant, unless adequate provision is made for proper drainage and such provision is approved in advance by the ACC. Specifically, and not by way of limitation, 4892-4621-0975v.3 51928-142 19 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS no Improvement, including landscaping, may be installed which impedes the proper drainage of water between Lots.

3.4 Construction Activities. The Restrictions will not be construed or applied so as to unreasonably interfere with or prevent normal construction activities during the construction of Improvements by an Owner (including Declarant or a Homebuilder) upon or within the Property.

Specifically, no such construction activities will be deemed to constitute a nuisance or a violation of the Restrictions by reason of noise, dust, presence of vehicles or construction machinery, posting of signs or similar activities, provided that such construction is pursued to completion with reasonable diligence and conforms to usual construction practices in the area. In the event that construction upon any Lot does not conform to usual practices in the area as determined by the ACC in its sole and reasonable judgment, the ACC will have the authority to seek an injunction to stop such construction. In addition, if during the course of construction upon any Lot there is excessive accumulation of debris of any kind which would render the Lot or any portion thereof unsanitary, unsightly, offensive, or detrimental to it or any other portion of the

upon any Lot there is excessive accumulation of debris of any kind which would render the Lot or any portion thereof unsanitary, unsightly, offensive, or detrimental to it or any other portion of the Property, then the ACC may contract for or cause such debris to be removed, and the Owner of the Lot will be liable for all reasonable expenses incurred in connection therewith.

3.5 Roofing. The roofs of all buildings shall be approved by the ACC. Roofs of buildings may be constructed with "Energy Efficient Roofing" with the advance written approval of the ACC. For the purpose e of this Section 3.5, "Energy Efficient Roofing" means shingles that are designed primarily to: (a) be wind and hail resistant; (b) provide heating and cooling efficiencies greater than those provided by customary composite shingles; or (c) provide solar generation capabilities. The ACC will not prohibit an Owner from installing Energy Efficient Roofing provided that the Energy Efficient Roofing shingles: (i) resemble the shingles used or otherwise authorized for use within the community; (ii) are more durable than, and are of equal or superior quality to, the shingles used or otherwise authorized for use within the community; and (iii) match the aesthetics of adjacent property. An Owner who desires to install Energy Efficient Roofing will be required to comply with the architectural review and approval procedures set forth in the Restrictions. In conjunction with any such approval process, the Owner should submit information which will enable the ACC to confirm the criteria set forth in this Section 3.5. Any other type of roofing material shall be permitted only with the advance written approval of the ACC.

3.6 Swimming Pools. Any swimming pool constructed on a Lot must be enclosed with a fence

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n 3.5. Any other type of roofing material shall be permitted only with the advance written approval of the ACC.

3.6 Swimming Pools. Any swimming pool constructed on a Lot must be enclosed with a fence or other enclosure device completely surrounding the swimming pool which, at a minimum, satisfies all Applicable Law and be approved in advance by the ACC. Nothing in this Section 3.6 is intended or shall be construed to limit or affect an Owner's obligation to comply with any Applicable Law concerning swimming pool enclosure requirements. Unless otherwise approved in advance by the ACC, aboveground or temporary swimming pools are not permitted on a Lot.

3.7 Compliance with Setbacks. No residence or any other permanent structure or Improvement may be constructed on any Lot nearer to a street than the minimum building setback lines shown on the Plat or as required by Applicable Law, and no building or structure shall be located on any utility easements. The ACC may require additional setbacks in conjunction with the review and approval of proposed Improvements in accordance with Article 7 of this Declaration.

3.8 Solar Energy Device. Solar Energy Devices may be installed with the advance written approval of the ACC in accordance with the procedures and requirements set forth below: 3.8.1 Application. To obtain ACC approval of a Solar Energy Device, the Owner shall provide the ACC with the following information: (i) the proposed installation location of the Solar Energy 4892-4621-0975v.3 51928-142 20 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS Device; and (ii) a description of the Solar Energy Device, including the dimensions, manufacturer, and

142 20 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS Device; and (ii) a description of the Solar Energy Device, including the dimensions, manufacturer, and photograph or other accurate depiction (the "Solar Application"). A Solar Application may only be submitted by an Owner unless the Owner's tenant provides written confirmation at the time of submission that the Owner consents to the Solar Application. The Solar Application shall be submitted in accordance with the provisions of Article 7 of this Declaration.

3.8.2 Approval Process. The ACC will review the Solar Application in accordance with the terms and provisions of Article 7 of this Declaration. The ACC will approve a Solar Energy Device if the Solar Application complies with Section 3.8.3 below UNLESS the ACC makes a written determination that placement of the Solar Energy Device, despite compliance with Section 3.8.3, will create a condition that substantially interferes with the use and enjoyment of property within the Property by causing unreasonable discomfort or annoyance to persons of ordinary sensibilities. The ACC's right to make a written determination in accordance with the foregoing sentence is negated if all Owners of Lots immediately adjacent to the Owner/applicant provide written approval of the proposed placement. Any proposal to install a Solar Energy Device on Common Area or Special Common Area or property owned or maintained by the Association must be approved in advance and in writing by the Board, and the Board need not adhere to this Section 3.8.2 when considering any such request.

3.8.3 Approval Conditions. Unless otherwise approved in advance and in writing by

ce and in writing by the Board, and the Board need not adhere to this Section 3.8.2 when considering any such request.

3.8.3 Approval Conditions. Unless otherwise approved in advance and in writing by the ACC, each Solar Application and each Solar Energy Device to be installed in accordance therewith must comply with the following: (i) The Solar Energy Device must be located on the roof of the residence located on the Owner's Lot, entirely within a fenced area of the Owner's Lot, or entirely within a fenced patio located on the Owner's Lot. If the Solar Energy Device will be located on the roof of the residence, the ACC may designate the location for placement unless the location proposed by the Owner increases the estimated annual energy production of the Solar Energy Device, as determined by using a publicly available modeling tool provided by the National Renewable Energy Laboratory, by more than ten percent (10%) above the energy production of the Solar Energy Device if installed in the location designated by the ACC. If the Owner desires to contest the alternate location proposed by the ACC, the Owner should submit information to the ACC which demonstrates that the Owner's proposed location meets the foregoing criteria. If the Solar Energy Device will be located in the fenced area of the Owner's Lot or patio, no portion of the Solar Energy Device may extend above the fence line.

(ii) If the Solar Energy Device is mounted on the roof of the principal residence located on the Owner's Lot, then: (A) the Solar Energy Device may not extend higher than or beyond the roofline; (B) the Solar Energy Device must conform to the slope of the roof and the top edge of the Solar Device must be parallel to the roofline; and (C) the frame, support brackets, or visible piping

Page 27

oofline; (B) the Solar Energy Device must conform to the slope of the roof and the top edge of the Solar Device must be parallel to the roofline; and (C) the frame, support brackets, or visible piping or wiring associated with the Solar Energy Device must be silver, bronze or black.

3.9 Rainwater Harvesting Systems. Rain barrels or rainwater harvesting systems (a "Rainwater Harvesting System") may be installed with the advance written approval of the ACC.

3.9.1 Application. To obtain ACC approval of a Rainwater Harvesting System, the Owner shall provide the ACC with the following information: (i) the proposed installation location of the Rainwater Harvesting System; and (ii) a description of the Rainwater Harvesting System, including the color, dimensions, manufacturer, and photograph or other accurate depiction (the "Rain System Application"). A Rain System Application may only be submitted by an Owner unless the Owner's tenant 4892-4621-0975v.3 51928-142 21 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS provides written confirmation at the time of submission that the Owner consents to the Rain System Application.

3.9.2 Approval Process. The decision of the ACC will be made in accordance with Article 7 of this Declaration. Any proposal to install a Rainwater Harvesting System on Common Area or Special Common Area must be approved in advance and in writing by the Board, and the Board need not adhere to this Section 3.9.2 when considering any such request.

3.9.3 Approval Conditions. Unless otherwise approved in advance and in writing by the ACC, each Rain System Application and each Rainwater Harvesting System to be installed in accordance therewith must comply with the following:

nless otherwise approved in advance and in writing by the ACC, each Rain System Application and each Rainwater Harvesting System to be installed in accordance therewith must comply with the following: (i) The Rainwater Harvesting System must be consistent with the color scheme of the residence constructed on the Owner's Lot, as reasonably determined by the ACC.

(ii) The Rainwater Harvesting System does not include any language or other content that is not typically displayed on such a device.

(iii) The Rainwater Harvesting System is in no event located between the front of the residence constructed on the Owner's Lot and any adjoining or adjacent street.

(iv) There is sufficient area on the Owner's Lot to install the Rainwater Harvesting System, as reasonably determined by the ACC. See Section 3.9.4 for additional guidance.

3.9.4 Guidelines. If the Rainwater Harvesting System will be installed on or within the side yard of a Lot, or would otherwise be visible from a street, Common Area, Special Common Area, or another Owner's Lot, the ACC may regulate the size, type, shielding of, and materials used in the construction of the Rainwater Harvesting System. Accordingly, when submitting a Rain System Application, the application should describe methods proposed by the Owner to shield the Rainwater Harvesting System from the view of any street, Common Area, Special Common Area, or another Owner's Lot. When reviewing a Rain System Application for a Rainwater Harvesting System that will be installed on or within the side yard of a Lot, or would otherwise be visible from a street, Common Area, Special Common Area, or another Owner's Lot, any additional regulations imposed by the ACC to regulate the

Page 28

n or within the side yard of a Lot, or would otherwise be visible from a street, Common Area, Special Common Area, or another Owner's Lot, any additional regulations imposed by the ACC to regulate the size, type, shielding of, and materials used in the construction of the Rainwater Harvesting System, may not prohibit the economic installation of the Rainwater Harvesting System, as reasonably determined by the ACC.

3.10 Xeriscaping. As part of the installation and maintenance of landscaping on an Owner's Lot, an Owner may submit plans for and install drought tolerant landscaping ("Xeriscaping") upon written approval by the ACC. All Owners implementing Xeriscaping shall comply with the following: 3.10.1 Application. Approval by the ACC is required prior to installing Xeriscaping. To obtain the approval of the ACC for Xeriscaping, the Owner shall provide the ACC with the following information: (i) the proposed site location of the Xeriscaping on the Owner's Lot; (ii) a description of the Xeriscaping, including the types of plants, border materials, hardscape materials and photograph or other accurate depiction and (iii) the percentage of yard to be covered with gravel, rocks and cacti (the "Xeriscaping Application"). A Xeriscaping Application may only be submitted by an Owner unless the Owner's tenant provides written confirmation at the time of submission that the Owner consents to the Xeriscaping Application. The ACC is not responsible for: (i) errors or omissions in the Xeriscaping 22 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS Application submitted to the ACC for approval; (ii) supervising installation or construction to confirm

8-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS Application submitted to the ACC for approval; (ii) supervising installation or construction to confirm compliance with an approved Xeriscaping Application or (iii) the compliance of an approved application with Applicable Law.

3.10.2 Approval Conditions. Unless otherwise approved in advance and in writing by the ACC, each Xeriscaping Application and all Xeriscaping to be installed in accordance therewith must comply with the following: (i) The Xeriscaping must be aesthetically compatible with other landscaping in the community as reasonably determined by the ACC. For purposes of this Section 3.10, "aesthetically compatible" shall mean overall and long-term aesthetic compatibility within the community. For example, an Owner's Lot plan may be denied if the ACC determines that: a) the proposed Xeriscaping would not be harmonious with already established turf and landscaping in the overall community; and/or b) the use of specific turf or plant materials would result in damage to or cause deterioration of the turf or landscaping of an adjacent property owner, resulting in a reduction of aesthetic appeal of the adjacent property Owner's Lot.

(ii) No Owners shall install gravel, rocks or cacti that in the aggregate encompass over thirty percent (30%) of such Owner's front yard or fifty percent (50%) of such Owner's back yard.

The Xeriscaping must not attract diseases and insects that are harmful to the existing landscaping on neighboring Lots, as reasonably determined by the ACC.

(iii) 3.10.3 Process. The decision of the ACC will be made within a reasonable time, or within the time period otherwise required by the principal deed restrictions which govern the review and

he ACC.

(iii) 3.10.3 Process. The decision of the ACC will be made within a reasonable time, or within the time period otherwise required by the principal deed restrictions which govern the review and approval of Improvements. A Xeriscaping Application submitted to install Xeriscaping on property owned by the Association or property owned in common by Members of the Association will not be approved.

Any proposal to install Xeriscaping on property owned by the Association or property owned in common by Members of the Association must be approved in advance and in writing by the Board, and the Board need not adhere to the requirements set forth in this Section 3.10 when considering any such request.

3.10.4 Approval. Each Owner is advised that if the Xeriscaping Application is approved by the ACC, installation of the Xeriscaping must: (i) strictly comply with the Xeriscaping Application; (ii) commence within thirty (30) days of approval; and (iii) be diligently prosecuted to completion. If the Owner fails to cause the Xeriscaping to be installed in accordance with the approved Xeriscaping Application, the ACC may require the Owner to: (i) modify the Xeriscaping Application to accurately reflect the Xeriscaping installed on the Property; or (ii) remove the Xeriscaping and reinstall the Xeriscaping in accordance with the approved Xeriscaping Application. Failure to install Xeriscaping in accordance with the approved Xeriscaping Application or an Owner's failure to comply with the post-approval requirements constitutes a violation of this Declaration and may subject the Owner to fines and penalties.

Any requirement imposed by the ACC to resubmit a Xeriscaping Application or remove and relocate

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quirements constitutes a violation of this Declaration and may subject the Owner to fines and penalties.

Any requirement imposed by the ACC to resubmit a Xeriscaping Application or remove and relocate Xeriscaping in accordance with the approved Xeriscaping Application shall be at the Owner's sole cost and expense.

3.11 Garages. All garages shall be maintained for the parking of automobiles and may not be used for storage or other purposes which preclude its use for the parking of automobiles. No garage may be permanently enclosed or otherwise used for habitation.

23 AMENDED AND RESTATED 4892-4621-0975v.3 51928-142 DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS ARTICLE 4 MONTGOMERY OAKS HOMEOWNERS ASSOCIATION, INC.

4.1 Organization. The Association will be a nonprofit corporation created for the purposes, charged with the duties, and vested with the powers of a Texas nonprofit corporation. Neither the Certificate nor Bylaws will for any reason be amended or otherwise changed or interpreted so as to be inconsistent with this Declaration.

4.2 Membership.

4.2.1 Mandatory Membership. Any person or entity, upon becoming an Owner, will automatically become a Member of the Association. Membership will be appurtenant to and will run with the ownership of the Lot that qualifies the Owner thereof for membership, and membership may not be severed from the ownership of the Lot, or in any way transferred, pledged, mortgaged or alienated, except together with the title to such Lot. Within thirty (30) days after acquiring legal title to a Lot, if requested by the Board, an Owner must provide the Association with: (1) a copy of the recorded deed by which the Owner has acquired title to the Lot; (2) the Owner's address, email address, phone number, and driver's

Board, an Owner must provide the Association with: (1) a copy of the recorded deed by which the Owner has acquired title to the Lot; (2) the Owner's address, email address, phone number, and driver's license number, if any; (3) any Mortgagee's name and address; and (4) the name, phone number, and email address of any Resident other than the Owner.

If you acquire a Lot, you automatically become a member of the Association.

4.2.2 Membership is Mandatory!

Easement of Enjoyment - Common Area. Every Member will have a right and easement of enjoyment in and to all of the Common Area and an access easement by and through any Common Area, which easements will be appurtenant to and will pass with the title to such Member's Lot, subject to the following restrictions and reservations: (i) The right of Declarant, or the Declarant's designee, to cause such Improvements and features to be constructed upon the Common Area, as determined from time to time by Declarant, in the Declarant's sole and absolute discretion; (ii) The right of the Association to suspend the Member's right to use the Common Area for any period during which any Assessment against such Member's Lot remains past due and for any period during which such member is in violation of any provision of the Restrictions; (iii) The right of Declarant, during the Development Period, and the Board thereafter, to dedicate or transfer all or any part of the Common Area to any public agency, authority or utility any purpose; for (iv) The right of Declarant, during the Development Period, and the Board thereafter, to grant easements or licenses over and across the Common Area; (v) With the advance written approval of Declarant during the Development Period,

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ring the Development Period, and the Board thereafter, to grant easements or licenses over and across the Common Area; (v) With the advance written approval of Declarant during the Development Period, the right of the Board to borrow money for the purpose of improving the Common Area and, in furtherance thereof, mortgage the Common Area; (vi) The right of Declarant, during the Development Period, and the Board, with the advance written approval of Declarant during the Development Period, to promulgate Rules and Regulations regarding the use of the Common Area and any Improvements thereon; and 24 AMENDED AND RESTATED 4892-4621-0975v.3 51928-142 DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS (vii) The right of the Association to contract for services with any third parties on such terms as the Board may determine, except that during the Development Period, all such contracts must be approved in advance and in writing by Declarant.

4.2.3 Easement of Enjoyment - Special Common Area. Each Owner of a Lot which has been assigned use of Special Common Area in a Recorded instrument will have a right and easement of enjoyment in and to all of such Special Common Area for its intended purposes, and an access easement, if applicable, by and through such Special Common Area, which easement will be appurtenant to and will pass with title to such Owner's Lot, subject to Section 4.2.2 above, and subject to the following restrictions and reservations: (i) The right of Declarant or the Declarant's designee, during the Development Period, and the Board thereafter, to cause such Improvements and features to be constructed upon the Special Common Area, as determined from time to time by Declarant, in the Declarant's sole and absolute discretion; (ii)

thereafter, to cause such Improvements and features to be constructed upon the Special Common Area, as determined from time to time by Declarant, in the Declarant's sole and absolute discretion; (ii) The right of Declarant to grant additional Lots use rights in and to Special Common Area in a subsequently filed Recorded instrument; (iii) The right of the Association to suspend the Member's rights to use the Special Common Area for any period during which any Assessment against such Member's Lot remains past due and for any period during which such Member is in violation of any provision of this Declaration; (iv) With the advance written approval of Declarant during the Development Period, the right of the Board to grant easements or licenses over and across the Special Common Area or to dedicate or transfer all or any part of the Special Common Area to any public agency, authority or utility for any purpose; (v) With the advance written approval of Declarant during the Development Period, the right of the Board to borrow money for the purpose of improving the Special Common Area and, in furtherance thereof, mortgage the Special Common Area; (vi) The right of Declarant, during the Development Period, and the Board, with the advance written approval of Declarant during the Development Period, to promulgate Rules and Regulations regarding the use of the Special Common Area and any Improvements thereon; and (vii) The right of the Association to contract for services with any third parties on such terms as the Board may determine, except that during the Development Period, all such contracts must be approved in advance and in writing by Declarant.

4.3 Governance. As more specifically described in the Bylaws, the Board will consist of at

at during the Development Period, all such contracts must be approved in advance and in writing by Declarant.

4.3 Governance. As more specifically described in the Bylaws, the Board will consist of at least three (3) persons elected at the annual meeting of the Association, or at a special meeting called for such purpose. Notwithstanding the foregoing provision or any provision in this Declaration to the contrary, Declarant will have the sole right to appoint and remove all members of the Board until the tenth (10th) anniversary of the date this Declaration is Recorded. Not later than the tenth (10th) anniversary of the date this Declaration is Recorded, or sooner as determined by Declarant, the Board shall hold a meeting of Members of the Association for the purpose of electing one-third (1/3) of the Board (the "Initial Member Election Meeting"), which Board member(s) must be elected by Owners other than the Declarant.

Declarant shall continue to have the sole right to appoint and remove two-thirds (2/3) of the Board from and after the Initial Member Election Meeting until expiration or termination of the Development Period.

The individual(s) elected to the Board at the Initial Member Election Meeting shall be elected for a one (1) 25 4892-4621-0975v.3 51928-142 AMENDED AND RESTATED DECLARATION OF COVENANTS, CONDITIONS AND RESTRICTIONS MONTGOMERY OAKS