Lost RiverAirportTracts Association

Mazama, Washington 98833

Restated By-Laws of Lost RiverAirportTracts Association

Final revision - 04/29/09

Lost RiverAirportTracts Association

Mazama, Washington 98833

Restated By-Laws of Lost RiverAirportTracts Association

(As approved May 24, 2009)

Article 1 Definitions ...... 3

Article 2 Applicability ...... 3

Article 3 Purpose ...... 3

Article 4 Membership …………...... 3

Article 5 Voting ………………………………………………………………………. 4

Article 6 Association Meetings …………………………………………………….. 5

Article 7 Conduct of Meetings ...... 5

Article 8Trustees.……...... 5

Article 9 Officers ……...... 7

Article 10 Committees ...... 8

Article 11 Association Business ...... 10

Article 12 Assessments and Fees...... 12

Article 13 Obligations of Owners ...... 12

Article 14 Indemnification ...... 13

Article 15 Notices ...... 13

Article 16 Amendment ...... 13

Signatures …………………………………………………………………………...... 14

These restated by-laws were adopted by the Lost River Airport Tracts Association, known as the Lost River Airport Association (the Association), pursuant to Article X of the Association's originally adopted by-laws, and adopted by the Associationon May 24, 2009.

Article 1 Definitions

The definitions of terms contained in theseBy-laws shall apply to any terms, which are used in these by-laws.

Article 2 Applicability

These by-laws shall be applicable to and govern the Association, the Board of Trustees, and officersthereof, and the Members in respect to all Association related business and conduct, and the managementthereof.

Article 3 Purpose

3.01 – The Corporation shall be conducted as a non-profit corporation for the purposes set forth in the Articles of incorporation for use and maintenance as a community facility.

3.02 – The Corporation shall have the power to levy and collect dues, fees, and assessments against its Members and Access Owners and against the tracts owned or purchased by them.

3.03 –The purposes for which the corporation was created may be altered, modified, diminished or reduced by the vote of the Members in accordance with Washington state law.

Article 4Membership and Access

4.01 - All property owners within the boundaries of Lost River Airport Tractsshall be Members of the Association (Members). In addition, the Association is required to grant access to its roads and air field to those who own certain property adjacent to the boundaries of the Associationairport (Access Owners). Such Access Owners shall not be entitled to connect to the LRAA water system.

4.02 – Membership shall be inseparably appurtenant to lots contained in the Lost River Airport Tracts development. Each owner of a lot in the Lost River Airport Tracts development shall be a Member of the Associationand upon transference of ownership, membership in the Association shall be deemed transferred to the successor owner.

4.03–No Member may withdraw from the Association except upon transfer of title to the real property to which his Membership is appurtenant. No compensation shall be paid by the Association upon any transfer of Membership and no Member whose Membership has been transferred shall be entitled to share or participate in any of the rights, property or assets of the corporation. Access Owners must continue to pay the required fees so long as they continue to own land requiring access to Association roads. Access Owners will notify any subsequent purchaser of the access easement and required fees.

4.04 – In the event of partition of multiple lots by a single owner and sale to another owner, each owner of a separate lot shall be entitled to, and required to be, a Member of the Association.

Article 5 Voting

5.01 –In order for any Member to participate in the parliamentary process of either the Annual Meeting or any Special Meeting, bring any motion to the Membership for a vote, vote on any Association business, either in person, by mail or valid proxy, that Member must be a Member in good standing. Access Ownersin good standing shall be entitled to participate in the parliamentary process and in voting as described and allowed in 5.03, below. To be in good standing a Memberor Access Owner must be current on all applicable Association dues, assessments, and fees, or current on a payment plan approved by the Board for all applicable Association dues, assessments and fees.

5.02 -Each Member shall have one vote for all Association business regardless of the number of lots owned byeach owner. If a lot is owned by a marital community, a vote may be cast by either spouse but not each spouse, and if a lot isowned by two or more persons (an ownership group), a vote may be cast by any individual owner but not by each owner.

5.03 - Lost River Airport Association Access Ownersshall be entitled to one vote for each parcel or group of parcels owned by one owner or ownership group at Association meetings concerning the roads and airportonly.

5.04- Ballot Casting - All voting shall be by Member or Access Owner in attendance, by proxy or through voting by mail. If voting by proxy through another Member or Access Owner, the Memberor Access Owner presenting the proxy for the absent Memberor Access Owner must also be a Memberor Access Owner in good standing. Proxies must be submitted in writing to the Board for verification of the Member’s or Access Owner’ status at least five (5) days prior to any business being transacted that requires a vote.

5.05 – Method of Balloting – Voting shall be held via paper ballot. Such ballots are to be distributed to the AssociationMembers by the Treasurer and collected by the Secretary. Counting of ballots shall be conducted openly by the Secretary and verified by the Treasurer and two or more Members of the Association. If counting results cannot be confirmed by the counters, then a revote shall immediately occur and be counted as provided in this Article 5.

Article 6 Meetings of Members

6.01 Annual Meetings - are defined as those meetings of the Membersand Access Owners that are held on the Sunday of Memorial Day weekend of each year at atime and place, as determined by the Board of Trustees.

6.02 Special Meetings–are defined as those meetings of the Membersand Access Owners that may be called at any time by the President, a majority of the Board ofTrustees, or twenty percent (20%) of the Members of the Association in good standing. If the Special Meeting will relate to roads or the airport, Access Owners shall be invitedto the meeting.

6.03 Notices of Meetings - Notices of the time and place of the Annual Meetings and of the date and time of Special Meetings shall be in writing and shall be given to each Member not less than fourteen (14) days nor more than sixty (60) days inadvance of each meeting. The notice of Annual Meeting shall specify i) that it is an annual meeting at whichthere shall be an election of Trustees, ii) any proposed changes or amendments to these by-laws, iii)that review and approval of the annual budget will take place, iv) the nature of any othermatters that may come before the meeting. A notice of Special Meeting shall specify i) any proposed changes or amendments to these By-laws, ii) the nature of thebusiness to be considered and iii) and the votes to be taken at such meeting. No other business shall be considered at such meeting. To be considered at any meeting, all proposed By-law amendments must be included in the notice of such meeting.

6.04 Quorum - A quorum for the conduct of any business at an Annual or Special meeting shall consist of twenty-five percent(25%) of the Membersin good standing present in person, or by valid proxyat the beginning of the meeting

6.05 Issues to be voted upon –If a Member or Access Owner wants to bring an issue to the Annual Meeting for a vote by the Members and Access Owners, a written explanation of the nature of the topic to be addressed and the vote to be requested must be received by the Board, in writing, at least thirty(30) days prior to the Annual Meeting. Speeches by Members and Access Owners will be limited to no more than 5 minutes unless the Board allows more time. Members and Access Owners wishing to speak should notify the Board no later than the morning of the Annual Meeting. No issues may be presented for a vote during such speeches unless they have been provided to the Board as set forth in this Article 6. Access Owners may bring issues or make speeches only on the subject of roads or the airport.

Article 7 Conduct of Meetings

All meetings shall be conducted in a civil and respectful manner.

Article 8Trustees

8.01 Number of Trustees - The management of the Association shall be vested in the Board of Trustees which shall consist of notless than five (5) nor more than nine (9) persons in any odd number combination.

8.02 Qualification of Trustees - Each Trustee shall at all times, during their term of office be a Member and in good standing. If a Trustee ceases to be a Member, or fails to maintain good standing, they shall be deemed to have resigned as a Trustee as of the date their ownership transfers, or 45 days after any payment is due to the Association.

8.03 Nominations by Mail - Trustees may be nominated by mail prior to the Annual Meeting, provided:

8.03.1 the nomination is received by the Board at least thirty (30) days prior to the Annual Meeting;

8.03.2 that the nominated Member is a Member in good standing as of at least five (5) days prior to the Annual Meeting and,

8.03.3 the nominated Member states, either at the Annual Meeting or in the nominating letter, that they agree to accept the Trustee position if elected.

8.04 Election of Trustees - Trustees shall be elected by the Members at the Annual Meeting. Each Memberin good standing shall be entitled to castone vote for each Trustee position that is to be voted upon in accordance with article 5 of these By-laws. Nominations for candidates for officeof Trusteewill be taken from the Memberson the day of the Annual Meeting or by mail in accordance with article 8.03. The nominated Member or an authorized representative must be present at the Annual Meeting for the nominated member to be elected.

8.05 Terms of Trustees - Trustees shall be elected for terms of three (3) years. Trustees may not serve more than two (2)consecutive terms. The Trustees terms shall be staggered such that one-third (1/3rd) of the Trustees areelected or re-elected at each Annual Meeting.

8.06 Removal of Trusteesby the Members- The Members may remove a member of the Board of Trustees with or without cause by a majorityvote ofthe Memberspresent in person, by proxy or by mail-in ballot at any duly called meeting for which a notice of intent toremove such Trustee has been given. Appointment of a replacement Trustee shall be determined by a majority of the Members present in person, by proxy or by mail-in ballot at that same meeting, with such replacement Trustee being elected to serve until the next Annual Meeting. If such Members cannot reach agreement on a replacement Trustee within two (2) ballots, the Board of Trustees shall appoint a replacement Trustee,with such replacement Trustee being elected to serve until the next Annual Meeting. If the Members cannot reach agreement on a replacement Trustee within two (2) ballots, the Board of Trustees shall appoint a replacement Trustee, with such replacement Trustee being appointed to serve until the next Annual Meeting.

8.07Resignation or Death of Trustee - Upon the resignation, or death of a Trustee, the remaining Trustees shall appoint a replacementTrustee to serve as Trustee until the next Annual Meeting. Such replacement Trustee shall be eligible thereafter to be elected for up to two (2) terms in accordance with these Bylaws.

8.08 Meetings of Board of Trustees - The Board of Trustees shall hold aplanning meeting within one (1) week following the Annual Meeting for the purpose of electing officers for the ensuing year. In addition, the Board of Trusteesshall hold such other meetings at a time and place determined by the Trustees as may be required to conduct the business of the Association. Meetings ofthe Board of Trustees may be called by the president or by a majority of the Trustees upon three (3) days'notice. Notice may be by telephone, email or regular mail. A Boardmember may waive such notice in writing.Board members may participate in any Board meeting either in person or by conference call. Meetings of the Board may be conducted at a physical location, by conference call, or through any other technology that allows the Boardmembers to conduct the business of the Association.

8.09Open Meetings - Except as hereinafter stated, all meetings of the Board of Trustees shall be open for observation by Members. The Board shall keep minutes of all actions taken by it, and copies ofthese minutes shall be made availablewithout cost to any Memberby, for example,leaving copies of the minutes in a box at the bulletin board at the Firehouse, by E-mail, by posting on the Association website, or, upon request of a Member, by regular mail.The Board may meet inexecutive session, subject to the following requirements:

8.09.1 Upon an affirmative majority vote of the Board of Trusteesto meet in executiveor closed session, the Board may reconvene in closed session. The Board may reconvene in executivesession to consider personnel matters; consult with legal counsel or consider communication fromlegal counsel; and to discuss likely or pending litigation, matters involving possible violations of thegoverning documents of the Association, and matters involving the possible liability of a Member tothe Association.

8.09.2 The motion for an executive session shall state the purpose of the closed session which shallappear in the minutes of the Board meeting.

8.09.3 No motion or other action adopted, passed or agreed upon in executive session may becomeeffective unless the Board, following such session, reconvenes in open session and votes on suchmotion or other action.

The requirements of this section will not require the disclosure of informationwhich would be in violation of any law or which is otherwise privileged or exempt from disclosure.

8.10Quorum–Trustees

The presence of a majority of the then serving Trusteesparticipating in a duly called meeting shall constitute a quorum for the purpose of conducting anybusiness at a meeting of the Board of Trustees.

8.11 Delegation of Authority - The Board of Trustees may not delegate its authority to any other person or entity.

8.12 Forfeiture of Office - In the event that a Trustee is absent from three (3) consecutive duly calledmeetings of the Board of Trusteesand none of said absences are excused by the President or Secretary, the office of the absent Trustee shall beforfeited and shall be deemed vacant immediately upon the conclusion of such 3rd consecutive meeting of the Board. Inthat event, the absent Trustee shall no longer be considered or have any authority to act as a Trustee. The Board of Trustees may appoint a replacement Trustee, with such replacement Trustee being appointed to serve until the next Annual Meeting.

8.13 Financial compensation of Trustees –Trustees serve on a voluntary, non-paid basis. Trustees may not be paid employees or contractors of the Association during their term as Trustee, however, Trustees may be reimbursed for reasonable, out-of-pocket expenses they incur in conducting business on behalf of the Association.

Article 9 Officers

9.01 Officers - The officers of the Association shall be a President, Vice-President, Secretary, and Treasurer. Each officershall be a Member. All correspondence pertaining to the Association business shall be signed by an officer ofthe Board of Trustees and only an officer of the Board of Trustees may contractually commit the Association to any agreement for the Association.

9.02 President - The President shall preside at all meetings of the Members and of the Board of Trustees and mayexercise the powers ordinarily allocable to the presiding officer of a nonprofit corporation.

9.03 Vice-President - The Vice-President shall perform the functions of the President, in the absence, inability, or at the requestof the President.

9.04 Secretary - The Secretary shall keep minutes of the meetings of the Association and Board of Trustees and shall keepcorrespondence and other records as may be necessary and appropriate for the Association and the Boardof Trustees.

9.05 Treasurer - The Treasurer shall maintain a bank account for funds and shall deposit therein all assessments and otherfunds received for the Association, be responsible for maintaining accurate records thereof, and disburse the same only forAssociation purposes as approved by the Board of Trustees.

9.06 Election of Officers - The officers of the Association shall be elected annually by the Trustees. The Trustees by majority vote at a duly called meeting where such purpose was stated as the reason for the meetingmay also remove and replace an officer. Such removal shall not affect his/her position as a member of the Board of Trustees.

9.07Fidelity Bond Coverage - The Board of Trusteesshall require fidelity bond coverage for the Treasurer and may require that other officers have fidelity bond coverage in favor of the Association as the Board determines necessary or appropriate. The cost of such coverage shall be borne by the Association as a part of its annual budget.

Article 10 Committees

10.01 Committee Makeup -The Board of Trustees may create suchcommittees as are deemed necessary to fulfill the requirements of the By-laws. All committees shall be reviewed annually by the Board of Trustees and consist of at least three (3)Membersor Access Owners in good standing, the majority of which must be Members.

10.02 Role of Committees – the purpose and scope of any committee shall be to provide subject specific advice to the Board, make recommendations, and to conduct research for the Trustees on such matters as are specifically defined in the committee charter by the Board of Trustees.

10.03 Term of Office–Each member of a committee shall continue as such until their successor is appointed, until theycease to qualify as a member thereof, they resign their appointment, or the committee completes its purpose.

10.04 Chairperson - One member of each committee may be appointed chairperson by the Board of Trustees.

10.05 Vacancies - Vacancies in the membership of any committee may be filled by appointment made in the same manner asprovided in the case of original appointments.

10.06 Quorum - A majority of committee members present shall constitute a quorum for the conduct of committee business.

10.07 Rules - Each committee may adopt rules for its own governance which shall be consistent with these by-laws andwith any applicable rules adopted by the Board of Trustees.

Article 11 Association Business

11.01 Budget - The Board of Trustees shall annually prepare a proposed operating budget, which shall include the projectedannual revenue and expenses for the improvement, maintenance, repair, and replacement of the airport, roads, water system,and services, which the Association is to provide under the Articles of Incorporation. The proposed annualbudget shall additionally include all projected miscellaneous or special expenses associated with theoperation and business of the Association for the ensuing year, all expenses required by these By-laws tobe paid by the Association, and reserve funds in such amountsas may be required to conduct the business of the Association. The President of the Board of Trustees may not approve unbudgeted expenses in excess of five hundred dollars ($500.00) of Association funds without approval of the majority of the Board.