ARTICLE I
POWERS AND PURPOSES

Section 1.1.        Financing of Projects.  In order to implement the purposes for which the City of Olmos Park, Texas Higher Education Facilities Corporation (the “Corporation”) was formed as set forth in the Articles of Incorporation, the Corporation shall issue obligations to finance all or part of the cost of one or more projects pursuant to the provisions of the Section 53.35(b), Texas Education Code, as amended (the “Act”).

Section 1.2.        Use of Obligation Proceeds.  The proceeds of any notes, bonds, or other obligations of the Corporation shall be used solely for secular purposes.

Section 1.3.        Approval by the City of Issuance of Notes, Bonds and Other Obligations.  The Corporation will only issue its notes, bonds and other obligations after obtaining the approval of the City of Olmos Park, Texas (the “City”) to the issuance of such bonds, notes or other obligations.

(a)             At least fifteen (15) days prior to the issuance of the bonds, notes or other obligations, the Corporation shall file with the City a full and complete description of the educational or housing facilities or facilities which are incidental, subordinate or related thereto or appropriate in connection therewith, the cost of which is to be paid in whole or in part from the proceeds of such bonds, notes or other obligations of such Corporation, together with a complete explanation of the project costs and the necessity for such proposed facilities and a full and complete description of the bonds, notes or other obligations proposed to be issued in connection with the corporate financing including the sources of revenues from which payments of principal and interest will be made, and in addition those copies of the instruments that may be used in such financing by the Corporation.

(b)            Neither the faith and credit nor the taxing powers of the City shall be pledged for the payment of principal and redemption premium, if any, on such bonds, notes or other obligations of the Corporation.

Section 1.4.        Books and Records; Approval of Programs and Financing Statements.  The Corporation shall keep correct and complete books and records of accounts and shall also keep minutes of the proceedings of its board of directors (the “Board of Directors”) and committees having any of the authority of the Board of Directors.  All books and records of the Corporation may be inspected by any director or his agent or attorney for any proper purpose at any reasonable time; and at all times the governing body of the City shall be entitled to review and to revise the financial affairs, program, and activities of the Corporation at any time and from time to time, and the City shall have all other rights reserved to it in the Articles of Incorporation of the Corporation.

Section 1.5.        Nonprofit Corporation.  The Corporation shall be a nonprofit corporation, and no part of its net earnings remaining after payment of expenses, bonds, or other obligations shall ever inure to the benefit of any individual, firm, or corporation, except that in the event sufficient provision has been made for the full payment of the expenses, bonds, and other obligations of the Corporation, then any net earnings of the Corporation thereafter accruing shall be paid to the City.

Section 1.6.        Effect of Articles of Incorporation and Ordinance.  The affairs of the Corporation shall at all times be conducted in a manner subject to and in compliance with the provisions and requirements of the Articles of Incorporation of the Corporation and the Ordinance of the City ordering its creation.

Section 1.7.        Servicing and Closing Fees.  The applicant for any financial assistance by the Corporation shall pay a fee for each bond issue in an amount as approved by the City Council of the City.

ARTICLE II

BOARD OF DIRECTORS

Section 2.1.        Powers, Number and Term of Office.  The property and affairs of the Corporation shall be managed and controlled by the Board of Directors and, subject to the restrictions imposed by law, the Articles of Incorporation and these Bylaws, the Board of Directors shall exercise all of the powers of the Corporation.

The Board of Directors shall consist of not less than seven nor more than eleven directors, each of whom shall be appointed by the governing body of the City.

The directors constituting the first Board of Directors shall be those directors named in the Articles of Incorporation, each of whom, as well as any subsequent directors, shall serve for a term of two years or until his or her successor is appointed by the governing body of the City.  No officer or employee of the City is eligible for appointment as a director.

Any director may be removed from office at any time, with or without cause, by written resolution of the City.  All vacancies, from whatever cause, shall be filled by the governing body of the City.

Section 2.2.        Meetings of Directors.  The Board of Directors may hold their meetings at such place which the Board of Directors may from time to time designate; provided that, in the absence of any such designation by the Board of Directors, the meetings shall be held at the principal offices of the City.

Section 2.3.        Regular Meetings.  Regular meetings of the Board of Directors shall be held without necessity of notice at such times and places as shall be designated, from time to time, by resolution of the Board of Directors, a copy of which shall be given to the City Manager of the City.

Section 2.4.        Special Meetings.  Special meetings of the Board of Directors shall be held whenever called by the president, by the secretary, by a majority of the directors at the time in office or upon advice of or request by the governing body of the City.  At least three (3) days prior to any meeting, the Corporation shall notify the City Manager of the City that such meeting is to be held and the purposes thereof.  It is provided, however, that with the approval of the City Manager, a meeting may be held without such notice.

The Corporation shall give notice to each director of each Special Meeting in person, or by mail, telephone, or telegraph, at least two hours before the meeting.  Unless otherwise indicated in the notice thereof, any and all matters pertaining to the purposes of the Corporation may be considered and acted upon at a Special Meeting.  At any meeting at which every director shall be present, the City Manager having been notified or waived notice as herein required and permitted even though without any notice to the directors, any matter pertaining to the purpose of the Corporation may be considered and acted upon.

Section 2.5.        Quorum.  A majority of the directors fixed by these bylaws shall constitute a quorum for the consideration of matters pertaining to the purposes of the Corporation.  The act of a majority of the directors present at a meeting at which a quorum is in attendance shall constitute the act of the Board of Directors, unless the act of a greater number is required by law.

Section 2.6.        Conduct of Business.  At the meetings of the Board of Directors, matters pertaining to the purposes of the Corporation shall be considered in such order as from time to time the Board of Directors may determine.

At all meetings of the Board of Directors, the president shall preside, and in the absence of the president, the vice president shall exercise the powers of the president.

The secretary of the Corporation shall act as secretary of all meetings of the Board of Directors, but in the absence of the secretary, the presiding officer, subject to the first paragraph of Section 3.1, may appoint any person to act as secretary of the meeting.

Section 2.7.        Executive Committee.  The Board of Directors, by resolution passed by a majority of the directors in office, may designate two or more directors to constitute an executive committee, which committee, to the extent provided in such resolution, shall have and may exercise all of the authority of the Board of Directors in the management of the Corporation, except where action of the Board of Directors is specified by law or by the Articles of Incorporation.  The executive committee shall act in the manner provided in such resolution.  The executive committee so designated shall keep regular minutes of the transactions of its meetings, shall cause such minutes to be recorded in books kept for that purpose in the office of the Corporation, and shall report the same to the Board of Directors from time to time.

Section 2.8.        Compensation of Directors.  Directors as such shall not receive any salary or compensation for their services, except that they shall be reimbursed for their actual expenses incurred in performing such services.

ARTICLE III

OFFICERS

Section 3.1.        Titles and Term of Office.  The officers of the Corporation shall be a president, a vice president, a secretary, and a treasurer, and such other officers as the Board of Directors may from time to time elect or appoint.  Only the offices of the secretary and treasurer may be combined.  In the absence of the secretary, any officer other than the president may act in the secretary’s place.  The office of treasurer may be held by an employee of the City as appointed by the City Manager and approved by the Board of Directors.  Terms of office shall not exceed two years.

All officers shall be subject to removal from office, with or without cause, at any time by a vote of a majority of the entire Board of Directors.

A vacancy in the office of any officer shall be filled by a vote of a majority of the directors.

Section 3.2.        Powers and Duties of the President.  The president shall be the chief executive officer of the Corporation and, subject to the Board of Directors, the president shall be in general charge of the properties and affairs of the Corporation; he shall preside at all meetings of the Board of Directors; in furtherance of the purposes of this Corporation, the president may sign and execute all contracts, conveyances, franchises, bonds, deeds, assignments, mortgages, notes, and other instruments in the name of the Corporation.

Section 3.3.        Vice President.  The vice president shall have such powers and duties as may be assigned by the Board of Directors and shall exercise the powers of the president during that officer’s absence or inability to act.  Any action taken by the vice president in the performance of the duties of the president shall be conclusive evidence of the absence or inability of the president to act at the time such action was taken.

Section 3.4.        Treasurer.  The treasurer shall have custody of all the funds and securities of the Corporation which come into his hands.  When necessary or proper, he may endorse, on behalf of the Corporation, for collection, checks, notes, and other obligations and shall deposit the same to the credit of the Corporation in such bank or banks or depositories as shall be designated in the manner prescribed by the Board of Directors; he may sign all receipts and vouchers for payment made to the Corporation, either alone or jointly with such other officer as is designated by the Board of Directors; whenever required by the Board of Directors, he shall render a statement of his cash account; he shall enter or cause to be entered regularly in the books of the Corporation to be kept by him for that purpose full and accurate amounts of all moneys received and paid out on account of the Corporation; he shall perform all acts incident to the position of treasurer subject to the control of the Board of Directors; he shall, if required by the Board of Directors, give such bond for the faithful discharge of his duties in such form and amount as the Board of Directors may require.  The office of treasurer may be held by an employee of the City as appointed by the City Manager and approved by the Board of Directors.

Section 3.5.        Secretary.  The secretary shall keep the minutes of all meetings of the Board of Directors in the books provided for that purpose; he shall attend to the giving and serving of all notices; in furtherance of the purposes of this Corporation, he may sign with the president in the name of the Corporation, and/or attest the signature thereto, all contracts, conveyances, franchises, bonds, deeds, assignments, mortgages, notes, and other instruments of the Corporation, he shall have charge of the corporate books, records, and securities of the Corporation except those of which the treasurer shall have custody and charge pursuant to the preceding Section 3.4, and such other books and papers as the Board of Directors may direct, all of which shall at all reasonable times be open to inspection upon application at the office of the Corporation during business hours, and he shall in general perform all duties incident to the office of secretary subject to the control of the Board of Directors.

Section 3.6.        Executive Director.  The City Manager, or her designee, will serve as the Executive Director and the Treasurer of the Corporation to provide administrative support services for the Corporation, and perform duties as prescribed by the Board and the City Council.  The Executive Director shall not be a member of the Board.

Section 3.7.        Compensation.  Officers as such shall not receive any salary or compensation for their services, except that they may be reimbursed for their actual expenses incurred in performing such services.

ARTICLE IV

PROVISIONS REGARDING ARTICLES OF INCORPORATION
AND BYLAWS

Section 4.1.        Effective Date.  These Bylaws shall become effective only upon the occurrence of the following events:

(a)             the approval of these Bylaws by the governing body of the City; and

(b)            the adoption of these Bylaws by the Board of Directors.

Section 4.2.        Amendments to Articles of Incorporation and Bylaws.  The Articles of Incorporation may at any time and from time to time be amended by the methods prescribed therein.

These Bylaws may be amended at any time and from time to time by majority vote of the Board of Directors with approval of the governing body of the City.

ARTICLE V

GENERAL PROVISIONS

Section 5.1.        Principal Office.  The principal office of the Corporation shall be located at 119 West El Prado Drive, Olmos Park, Texas 78212.

Section 5.2.        Fiscal Year.  The fiscal year of the Corporation shall be as determined by the Board of Directors.

Section 5.3.        Seal.  The seal of the Corporation shall be as determined by the Board of Directors.

Section 5.4.        Resignations.  Any director or officer may resign at any time.  Such resignations shall be made in writing directed to the Mayor of the City.  A resignation shall take effect at the time specified therein, or, if no time be specified, at the time of its receipt by the Mayor and the president.  The acceptance of a resignation shall not be necessary to make it effective, unless expressly so provided in the resignation.

Section 5.5.        Action Without a Meeting of Directors of Committees.  Any action that may be taken at a meeting of the Board of Directors or of any committee may be taken without a meeting if the consent in writing, setting forth the action to be taken, shall be signed by all of the directors, or all of the members of the committee, as the case may be, and by the City Manager of the City.  Such consent shall have the same force and effect as a unanimous vote of the Board of Directors.

Section 5.6.        Deposit and Investment of Corporation Funds.

(a)             All proceeds from loans or from the issuance of bonds, notes, or other debt instruments (“Obligations”) issued by the Corporation shall be deposited and invested as provided in the resolution, order, indenture, or other documents authorizing or relating to their execution or issuance.

(b)            Subject to the requirements of contracts, loan agreements, indentures or other agreements securing Obligations, all other money of the Corporation, if any, shall be deposited, secured, and/or invested in the manner provided for the deposit, security, and/or investment of the public funds of the City.  The Board of Directors, with City Council approval, shall designate the accounts and depositories to be created and designated for such purposes, and the methods of withdrawal of funds therefrom for use by and for the purposes of the corporation upon the signature of its treasurer and such other persons as the Board of Directors designates.  The accounts, reconciliation, and investment of such funds and accounts shall be performed by the City Manager of the City, or his designee.

Section 5.7.        Approval or Advice and Consent of the City Council.  To the extent that these Bylaws refer to any approval by the City or refer to advice and consent by the City Council, such advice and consent shall be evidenced by a certified copy of a resolution, order, ordinance or motion duly adopted by the City Council.

Section 5.8.        Services of City Staff and Officers.  To the extent possible, the Corporation shall utilize the services and the staff employees of the City.  All requests for staff time or inquiries of staff will be requested through the City Manager’s Office.

Section 5.9.        Indemnification of Directors, Officers and Employees.

(a)             As provided in the Act, the Corporation is, for the purposes of the Texas Tort Claims Act (Subchapter A, Chapter 101, Texas Civil Practices and Remedies Code), a governmental unit and its actions are governmental functions.

(b)            The Corporation shall indemnify each and every member of the Board of Directors, its officers and its employees and each member of the City Council and each employee of the City, to the fullest extent permitted by law, against any and all liability or expense, including attorneys fees, incurred by any of such persons by reason of any actions or omissions that may arise out of the sanctions and activities of the Corporation.  The legal counsel for the Corporation is authorized to provide a defense for members of the Board of Directors, officers, and employees of the Corporation.

Section 5.10.     Approval of Bylaws by City and Adoption of Bylaws by Corporation.

These bylaws were approved by the City Council of the City on August 20, 2003 and adopted by the Board of Directors of the Corporation on September 4, 2003.

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