May 5, 2001

CHATEAU HEIGHTS COUNCIL OF CO-OWNERS, INC.

ANNUAL MEETING

Location: The Tower Club, McAllen, Tx.

Date: Saturday, May 5, 2001

Time: 7:00 P.M.

I. The meeting was called to order at 8:45 P.M., and the Board of Directors expressed their appreciation to out-going Board member, Mrs. Wanda McCormick, for her diligent service to the Board.

II. Roll call indicated that the following (15) homeowners were in attendance: #3, 6, 12, 16, 15, 18, 19, 21, 24, 25, 26, 27, 28, 29, and 31

III. There were not enough homeowners present to represent a quorum, therefore the meeting was adjourned and reconvened in approximately 15 minutes.

!V. Previous minutes from Annual Meeting dated April 22, 2000 were read and reviewed. A motion was made by Mr. Mike McCormick to approve the minutes as written, seconded by Mr. Alonzo, and unanimously approved.

V. The Management Report was presented to the Homeowners by Mr. Ted Miller.

VI. The Officers Report was presented by Wanda McCormick.

VII. The 2000 Financial Report was presented by Mr. Miller. A motion was made by Nancy Sheldon to accept the Year 2000 Financial Report, seconded by Mike McCormick, and unanimously approved.

VIII. The 2001 Budget was presented by Ted Miller. A motion for approval was made by Mr. Alonzo, seconded by Mrs. Leo, and unanimously approved.

IX. Homeowners discussed the setting of the assessment rate for the following year. A motion was made by Roy Robles to leave quarterly assessment rate at $525.00, seconded by Mrs. Leo, and unanimously approved.

X. The Homeowners discussed no old business.

XI. New Business was discussed as follows:

A. There were not an adequate number of homeowners present to act on the Resolution to Amend By-Laws.

B. There were not an adequate number of homeowners present to act on resolution to discount assessments for pre-payment.

C. Direct deposit of quarterly assessments was presented and explained by Ted Miller. There were only 4 homeowners interested in the direct deposit program and a minimum of 10 participants were needed to implement this program. Mr. Miller was to mail flyers explained this proposed program to all absentee homeowners.

XII. Nominations were accepted for the one available Board of Directors position. Mrs. Leo was nominated by Wanda McCormick and Mr. Edgar Alvarez was nominated by Mrs. Pelaez. A ballot vote was taken and Mrs. Leo was elected to the available Board of Directors position to take effect immediately.

XIII. The date of the Homeowners Annual Meeting for 2002 was discussed. A motion was made by Roy Robles that the meeting be set for Saturday, January, 19, 2002, seconded by Mrs. Leo and unanimously approved.

XIV. The floor was open to miscellaneous discussion and concerns of the Homeowners. There was much discussion concerning the current work being done by Cantu Construction, the gate operation, landscaping, and pool area. An explanation of the proxy vote was presented by Mr. Gary Hendrickson, Atty.

XV. A motion was made for adjournment by Nancy Sheldon, seconded by Mr. Alonzo, and unanimously approved.

XVI. The meeting was adjourned at 10:00 P.M.